INTERVIEW-Vimetco looks at bauxite mine openings
By Karen Norton
LONDON, Jan 29 (Reuters) - Netherlands-based aluminium company Vimetco (VICOq.L) will focus on adding bauxite mine assets to its portfolio in its bid to become a fully integrated producer of the metal, the company said.
"We're looking into the potential acquisition of bauxite assets. We're very much focused on that side as bauxite is still the missing piece," the company's CEO Christian Wuest told Reuters in an interview on Tuesday.
Wuest said the mid-size aluminium producer might buy an existing operation or carry out exploration. As a medium-term target it might develop its own mine, in which case it would also build an alumina plant at the same site to keep costs down.
Mine opportunities were seen in places such as India, Guinea and Sierra Leone.
Vimetco has some 680,000 tonnes of annual aluminium smelting capacity in Romania and China. The most recent purchase was China's Linfeng Aluminium Co. in China, which produces 110,000 tonnes of primary metal.
Linfeng was bought through Vimetco's 51 percent-controlled Zhongfu Industrial Co Ltd (600595.SS). Vimetco also owns 85 percent directly and 3-1/2 percent indirectly in Romania's Alro Slatina (ALRO.BX).
Wuest said Vimetco's project to develop a 1,000-megawatt coal-fired power plant in Romania with British-Romanian company InterAgro was proceeding as planned. In October, it said the plant was scheduled to become operational in 2012.
Inter-Agro focuses mainly on the export of fertilisers.
Vimetco also expected to make a final decision on equipment suppliers for a planned co-generation power plant, producing both steam and electricity, which would be located at its Tulcea alumina refinery, Wuest said.
He said the facility would be able to satisfy about one-quarter of the firm's power needs in Romania.
PROJECT PIPELINE
The Tulcea plant, in eastern Romania, has been shut since the start of 2007 for rehabilitation work. The refinery, which had the capacity to produce around half a million tonnes a year of alumina may restart next year.
"We're targetting probably the second half of 2009 to put it back into operation, but that's still subject to overall market conditions," Wuest said.
He added that expansion of the Alro Slatina smelter, which had been mooted in the past, was not on the agenda for now.
"Right now, given the Balkan region's energy needs and availability it doesn't make sense."
But downstream Vimetco upgraded its Romania rolling mill operations last year and, assuming a reasonable mix of sales, expects to produce 60,000 tonnes of rolled products this year.
In China, Wuest said the company planned to add casting equipment for wirerod, billet and slab by the end of the year at its Zhongfu operation in the central province of Henan.
Wuest said Vimetco aimed to continue its project pipeline.
"Not every project really happens, so you need a pool of projects in the pipeline to be successful with a few," he said.
Wuest said Vimetco viewed frenzied merger and acquisition activity in the sector as a chance to snap up small companies sold off as part of a big takeover.
"We see the industry further consolidating, and again this will offer opportunities rather than be a threat," he said.
(Edited by Peter Blackburn)
