Seventy Million Dollar Armenian Foil Plant Another Notch in United Company Rusal’s Merger March to Aluminum Top Spot

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Researched by Industrial Info Resources (Sugar Land, Texas). Rusal (Moscow, Russia), once tagged as the world’s third largest aluminum producer after Alcoa (NYSE:AA ) (Pittsburgh, Pennsylvania) and Alcan (NYSE:AL) (Montreal, Quebec), will by April 2007, be the leading shareholder of the largest global producer, United Company Rusal, formed by the merger of alumina and aluminum assets with Sual Group (Moscow) and Glencore International AG (Baar, Switzerland). The company has just commissioned the only aluminum foil production plant in the Caucasus region and Central Asia.

An investment of over $70 million into the extensive modernization has established Rusal Armenal as one of the most advanced foil mills in the world. The modernization program was contracted to Achenbach Buschhtten (Kreuztal, Germany), which completed the project in a fast-track time of 23 months. The program included the installation of supercasters in the continuous casting and rolling units. The project program developed a non-waste process cycle, abandoned then use of ingots and improved the quality of the products and cut expenses significantly. The preparatory rolling mill has also been fully modernized and is now equipped with monitoring tools and a process control system.

State-of-the-art environmental protection and labor safety systems have been implemented in the new plant. A process of lubricant steam collection removal and condensation system has been updated, modern fire fighting equipment has been installed and a complex fire system has been introduced. When the plant reaches full operation in mid-2007, it will have a total production capacity of 25,000 tons of foil per annum of which 18,000 tons will be a thin 6 – 9 micron foil, which is the most popular foil product in Russia as well as internationally. The plant will hold a 12% share in the total volume of foil products in the CIS states with its main market targets being Europe and the U.S. Orders for product, which will cover the plant running at full capacity, have already been received and Rusal is considering the potential to further expand the plant’s capacity to 40,000 tons per annum.

The Armenal plant is an example of Rusal’s declared commitment to develop hi-tech, state-of-the-art operations and ties Russia and Armenia into a cooperative economic project partnership.

When the United Company Rusal (UCR) is signed into formal existence in April 2007 Rusal will hold 66% through EN+, Sual will hold 22%, and Glencore 12%.

Rusal assets in the new entity will be Bratsk, Krasnoyarsk, Novokuznetsk, and Sayanogorsk aluminum smelters, Achinsk alumina plant, Nikolaev and Boksitogorsk alumina refineries, Friguia alumina plant (Guinea), Compagnie des Bauxites de Kindia (Guinea), Bauxite Company of Guyana, a stake in the Queensland Alumina refinery (Australia), and Armenal and Sayanal product plants and a cathode plant in China.

Sual Group will contribute Irkutsk, Ural, Kandalaksha, Bogoslovsky, Nadvoitsy, Volgograd and Volkhov aluminum smelters, Zaprozhye aluminum combine, Pikalevo alumkina refinery, SUBR, Ural Foil, Irkutsk Silicon, Ural Silicon and Irkutsk Powder Metallurgy.

Glencore International AG will contribute Aughinish (Ireland), Windalco and Alpart (Jamaica), and Eurallumina (Italy) alumina refineries as well as the Kubikenborg (Sweden) aluminum smelter.

En+, a name to note for the future, is a holding company established as part of Russia’s Basic Elements restructuring. Core assets in the EN+ portfolio include: Rusal, Eurosibenergo and United Oil Group. EN+’s strategic goal is to become one the leading international companies across industries that supply, consume and produce energy.

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