SALCO smelter project gains momentum

Tuesday, 9 October 2007, Kuching: The proposed US$2 billion aluminium smelter project is making more progress, with the appointment of prominent international engineering consultant Bechtel to undertake an engineering study, and the allocation of a parcel of State-owned land by the Sarawak Government at Similajau, near Bintulu.

The appointment of Bechtel comes close on the heels of the appointment of Chemsain Konsultant Sdn Bhd (Chemsain) and URS Australia Pty Ltd (URS) to conduct the EIA for the smelter project, which has been identified as the catalyst for the development of Sarawak’s central regional economic growth corridor.

“The allocation of land, commencement of the EIA and the appointment of Bechtel for the engineering study take this significant project to another level, bringing it closer to realization,” said Rio Tinto Aluminium’s General Manager Smelter Project Development Matt Liddy.

Malaysian Main Board-listed conglomerate, Cahya Mata Sarawak (CMS) and global aluminium producer, Rio Tinto Aluminium (RTA) recently signed a Heads of Agreement to commence feasibility studies for the development of a world class aluminium smelter in Similajau, which will be known as Sarawak Aluminium Company (SALCO). The signing, held in Kuching in August 2007, was witnessed by the Chief Minister of Sarawak.

The proposed SALCO aluminium smelter is expected to generate 4,700 direct and indirect jobs as well as billions of Ringgit to the Malaysian economy annually.

According to Matt Liddy, who is based in Kuching, the purpose of the engineering study is to make a detailed cost estimate of all the factors needed to construct the smelter.

The study will also provide the design for the layout of the smelter, identify options to allow for future expansion of the smelter and estimate the size of the workforce needed.

“We are pleased with the appointment of Bechtel as the engineering consultant for this study. Bechtel has built the majority of the world’s aluminium smelters and we are glad to have their expertise on board for the project,” Mr Liddy said.

“Bechtel provides technical, management, and directly related services to develop, manage, engineer, and build aluminium facilities worldwide. Current major Bechtel projects in the aluminium industry include the 360,000 tonnes per year Sohar smelter, under construction in Oman, which includes the world’s longest potline.

“Bechtel also constructed both the initial phase and the expansion of RTA’s Boyne Smelter in Gladstone, Australia. The 550,000 tonnes per year smelter is situated adjacent to the world heritage listed Great Barrier Reef and has spurred on the development of the local community that is now home to around 10,000 people, with the nearest residents located just 400 metres from the smelter.”

Matt Liddy said the feasibility studies would take approximately 12 to 15 months to complete and construction of the smelter could begin in early 2009.

The proposed smelter, to be located in Similajau, 60 kilometres from Bintulu town, would have an initial production capacity of 550,000 tonnes per year, with the capability to be expanded to 1.5 million tonnes. First production from the smelter is targeted for the fourth quarter of 2010. It is proposed that electricity for the smelter will come from the Bakun Hydroelectric Dam, which is currently under construction.

The expertise and credentials of RTA and CMS will greatly boost SALCO’s ability to ensure world class smelting operations.

“RTA and CMS are committed to developing a world class aluminium smelter that meets international standards with regard to environmental, health and safety that the two companies and Malaysia can be proud of,” Matt Liddy said.

”The smelter will adopt leading engineering standards and practices based on RTA’s world class practices used in its mining, refining and smelting operations.”

Sarawak Aluminium Company
Rio Tinto Aluminium Limited (RTA) and Cahya Mata Sarawak (CMS) are undertaking studies to develop an aluminium smelter in Sarawak, which will be known as Sarawak Aluminium Company (SALCO). RTA owns bauxite mines, alumina refineries and aluminium smelters, and has extensive experience in the design, engineering, construction, commissioning and operation of world class aluminium smelters. An aluminium smelter converts alumina into aluminium metal. The alumina for the Sarawak smelter would be sourced from RTA.

Bechtel
Bechtel is one of the world’s premier engineering, construction, and project management companies, with annual revenues in excess of US$20 billion. 40,000 employees are teamed with customers, partners, and suppliers on a wide range of projects around the globe. Over the last 100 years, Bechtel has completed more than 22,000 projects in 140 countries, specializing in the design and construction of highly complex, first-of-a-kind, and remote facilities around the world.