United Company RUSAL Begins Construction of Eurasia's Largest Bauxite and Alumina Complex

United Company RUSAL, the world's largest producer of aluminium and alumina, today announced completion of a state Feasibility Study appraisal for the construction of Komi Aluminium Bauxite and Alumina Complex in the Komi Republic. Investments into the project will exceed US $1.5 billion.

The project includes the construction of a 1.4 million tpa alumina refinery in the Komi Republic's Sosnogorsk region and capacity expansion at the operating Middle-Timan bauxite mine from 2.6 up to 6.4 million tpa. The feasibility study was developed by the Russian National Aluminium and Magnesium Institute (VAMI) which is part of United Company RUSAL.

Construction will commence in June 2007. The refinery will operate using state-of-the-art Bayer technology. The future refinery's infrastructure is currently being built at the production facility site in the Sosnogorsk region. Railway tracks have been laid from the Vorkuta-Moscow line to the site and a small concrete production plant has been built in addition to administrative and general-use buildings. All construction is being carried out by the Engineering and Construction Division (ECD) of United Company RUSAL.

Valery Matvienko, director of the Engineering and Construction Division commented: "The Komi Aluminium project is one of the company's top strategic priorities due to its potential to strengthen United Company RUSAL's raw materials base and play a crucial role in the implementation of greenfield smelter construction projects in Russia. The fact that an in-house engineering and construction division can manage this project at all stages - from feasibility study development to commissioning and maintenance - gives United Company RUSAL the opportunity to quickly and efficiently implement business ideas and maintain production dynamics".

The proven reserves of the Eurasia Middle-Timan bauxite deposit, the largest in Russia and Eurasia, amount to 260 million tonnes. The complex is expected to be commissioned at the end of 2009 and will create more than 10,000 new jobs. The start-up of the complex will secure more than a 40% increase in Russia's alumina output. By completion of the project the total amount of investment in infrastructure development in the Komi Republic is expected to reach US $25 million.