Rumours were rife this week that the project was slipping away from SA, following new Trade and Industry Minister Mandisi Mpahlwa and director-general Alistair Ruiters' meeting with Alcan officials.

There were suggestions that the R606m tax concession earmarked for the project as a sweetener last year had been put back into government's budget.

The department would not comment on this yesterday.

The aluminium project would represent SA's largest single investment to date. It would also validate government's multibillion rand development of the Coega industrial zone to boost the depressed Eastern Cape economy.

Lionel October, the department's deputy director-general, confirmed that a meeting between Mpahlwa, Ruiters and Alcan officials took place.

But he could not say what the outcome was.

Alcan, which took over French rival Pechiney last year, was in the process of consolidating the project plans of the two companies. The exercise would see the less profitable prospects cancelled.

The resignations last month of Raymond Hartle and Eugene Heeger as executive managers at Coega Development Corporation so close to Alcan's decision have also raised questions.