“Consistent with Alcan’s primary metal strategy, this project has the potential to achieve one of the lowest operating costs in the industry and become one of the world’s largest smelters,” said Dick Evans, president and CEO of Alcan.

The agreement was signed in Riyadh in the presence of Ali Al-Naimi, Saudi Arabian Minister of Petroleum and Mineral Resources and chairman of Ma’aden; Dr. Abdullah Al-Dabbagh, president and CEO of Ma’aden and Michel Jacques, president and CEO of Alcan Primary Metal Group.

“Ma’aden’s mine-to-metal project complements our attractive pipeline of projects in new regions for Alcan, including those at Sohar, Oman and COEGA South Africa,” said Jacques. The smelter— initially based on two AP 36 potlines— will be designed to accommodate a potential expansion of four additional lines that could increase annual production to over 2 million metric tons.”

As one of the world’s largest vertically integrated projects of its kind, the initial operations would feature a power plant delivering 1,400 megawatts; a 90-millionmt bauxite reserve located in Az Zabirah in northern Saudi Arabia representing a potential 30 years of mining; an alumina refinery with a capacity of 1.6 million mt/y; an aluminum smelter with a capacity of 720,000 mt/y with potential to expand to 2.1 mt/y. The alumina plant, aluminum smelter and power generation facilities would be located in the new Minerals Industrial City at Ras Az Zawr, on the east coast of Saudi Arabia. First metal would be expected during the first quarter of 2011, and first alumina a year later.

Next steps will include completing the joint venture agreement and pursuing project financing arrangements.

Ma’aden was established as a Saudi Arabian joint stock company in March 1997 and is presently owned 100% by the Saudi government. Its purpose is to facilitate the development of Saudi Arabia’s nonpetroleum mineral resources and to diversify the Kingdom’s economy away from the petroleum and petrochemical sectors.