UC RUSAL announces its production results for the first quarter of 2008

Bauxite production rose by 13.1% to 4,537,288 tonnes compared to the first quarter of 2007.

Alumina production rose by 3.5% to 2,837,030 tonnes compared to the same period last year.

Aluminium production increased by more than 9.4% to 1,096,236 tonnes compared to the first quarter of 2007 as a result of launching full capacity of the Khakas aluminium smelter.

Output of high value-added casthouse products improved by more than 17.8% and its share of total production reached 52% compared to the first quarter of 2007.

Foil production increased by 18.4% compared with the same period last year.

Overall investment for the first quarter of 2008 amounted to approximately USD 457 million. Investment in the expansion, reconstruction, modernization and technical refurbishing of existing facilities amounted to approximately USD 235 million.

*Figures for the first quarter of 2007 reflect the combined production results of United Company RUSAL, formed through the completion of the merger of RUSAL, SUAL and Glencore’s  alumina assets. Figures are preliminary and may be revised following audit completion.

 

Commenting on the results, Alexander Bulygin, CEO, United Company RUSAL, said: “The first three months of 2008 saw stable growth of all production figures, demonstrating how successful the three way merger to create the united company has been in its first year. Having secured the leadership position as the world’s largest aluminium and alumina producer, we have created a strong base from which to implement our strategy of diversification to turn the company into one of the global metals and mining majors.

“Early this year, the aluminium price set a new record of USD 3,180 per tonne on the London Metal Exchange (LME). We believe that this is sustainable and expect to see further rises in aluminium prices. Growth will be driven by a combination of the increased demand for metals in China and by the delay in launching new projects by global majors worldwide due to the lack of raw materials and electricity, as well as the increasing costs of production because of the weak dollar and high energy prices.”

The growth of aluminium production at UC RUSAL is due to the following factors: the launch of the Khakas Aluminium Smelter at its full capacity of 300,000 tonnes per annum; the February launch of the ALSCON plant in Nigeria; putting into operation the fifth potline at the Irkutsk Aluminium Smelter, as well as the continued modernisation of existing production facilities and a programme of efficiency improvements at UC RUSAL plants.

The 3.5% increase, compared to the first quarter of 2007, in alumina production resulted from an ongoing modernisation programme aimed at increasing production capacity at the Nikolaev Alumina Refinery to 1.7 million tonnes and from improvements to the technical and production performance at the Achinsk Alumina Refinery, as well as the stabilization of the production at the bauxite mining complex in Fria, Guinea.

The stabilisation of the production at the complex at Fria and the installation of new equipment at the Compagnie des Bauxites de Kindia (Guinea) and the Bauxite Company of Guyana have led to a significant growth in bauxite production by over 13.1% compared to the first quarter of 2007.

The launch of full capacity at the Armenal (Armenia) facility has increased aluminium foil production by more than 18% compared to the same period last year.

The rise of silicon production of 8.2% compared to the same period last year was achieved as result of the growing demand from domestic and international consumers as well as optimization of production processes at Silicon Co. and Urals Silicon production facilities.