U.S. aluminum producer Alcoa Inc. is in talks with Russian hydropower company HydroOGK on a US$3 billion project to build an aluminum smelter and a hydropower plant in Russia, a Russian newspaper reports.
HydroOGK, owned by electricity monopoly Unified Energy Systems (UES), confirmed that talks with Alcoa were taking place, but declined to elaborate.
“The talks are in a very early stage,” HydroOGK spokesman Yevgeni Druziaka said.
Kommersant business daily quoted sources in HydroOGK saying the smelter might have a capacity of 300,000 tons per year. Both plants could be located in Russia’s Far East, where HydroOGK has several operating hydro plants and plans to build several more.
Alcoa owns two aluminum plants in Russia, Samara Metallurgical Plant and Belaya Kalitva, acquired from Russia’s No. 1 aluminum producer, RUSAL, in 2004.
Earlier in August, HydroOGK signed a memorandum of understanding with SUAL, Russia’s second-largest aluminum producer, and Norway’s Hydro Aluminium to supply hydropower for a proposed new smelter in the Russian Far East. SUAL and Hydro Aluminium had said they are reviewing, but have not yet actually agreed to build, the proposed smelter, which would have a capacity of 600,000 tons a year.
HydroOGK took over UES’ hydropower assets as part of Russia’s power sector reforms. Its capacity is expected to increase to 23,300 MW by the end of the company’s restructuring, from 18,400 MW today.