No plans yet for Mozal III

Posted On Thursday, 09 October 2003 02:00 Published by eProp Commercial Property News
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Maputo - BHP Billiton would only consider building a Mozal III nearer the end of this decade, the world's largest resources group said yesterday.

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Maputo - BHP Billiton would only consider building a Mozal III nearer the end of this decade, the world's largest resources group said yesterday.

The company believed the aluminium market would be well supplied through to 2008. Only then would it evaluate adding extra capacity.

Mozal II, the expansion project to double the Mozambican aluminium smelter's production to 500 000 tons a year, was officially opened yesterday.

The $860 million expansion, which pushes Mozal into third position among the world's top three aluminium producers, has been delivered seven months ahead of schedule and $195 million under budget.

The $1.2 billion first phase took 31 months to develop and was $100 million under budget.

BHP Billiton has said that, on a cost per unit basis, it has decided to pursue brownfields rather than greenfields expansion. This means it would evaluate projects at existing operations before starting something new.

Peter Wilshaw, the general manager of Mozal, said its expansion meant the smelter would account for 2.5 percent of global aluminium production.  

Besides Mozal, BHP Billiton was close to completing Hillside 3, the expansion of its capacity at its smelter complex near Richards Bay.

Together, BHP Billiton's three aluminium smelters in southern Africa - Mozal, Hillside and Bayside (also in Richards Bay) contribute 7 percent to global aluminium production of 21.1 million tons.

"Aluminium is a mature market and as such grows in line with global economic growth, which is at 2 percent to 2.5 percent a year," said Wilshaw.

At current world aluminium production rates, Wilshaw said the expansion at Mozal had an incremental effect of adding about half-a-year's growth to the supply side of the industry.

Michael Campbell, a BHP Billiton spokesperson based in Johannesburg, said the site of the company's next aluminium investment would be determined by access to cheap electricity and a deep-water port.

Mozal II is one of the world's lowest-cost aluminium producers. Wilshaw said the combination of an efficient harbour, competitive power supply and investment incentives made it more competitive - for the moment.

Last modified on Wednesday, 16 April 2014 18:07

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