RABIGH, 31 January 2008 — Emaar, The Economic City and EMAL International — the joint venture of Mubadala Development Company and Dubai Aluminium Company Ltd. (Dubal), signed yesterday a memorandum of understanding (MOU) worth SR18.4 billion ($5 billion) to set up an aluminum smelter at King Abdullah Economic City (KAEC).
The MOU was signed here by Fahd A. Al-Rasheed, chief executive officer of Emaar, The Economic City and Abdulla J.M. Kalban, chief executive officer of Dubai Aluminium in the presence of Amr Abdullah Al-Dabbagh, governor of the Saudi Arabian Investment Authority (SAGIA) — the prime facilitator for KAEC.
The construction of the smelter will start at the end of this year. As planned, the smelter will produce as much as 70,000 tons of metal per year in the first phase of operation.
Al-Dabbagh said that “Saudi Arabia is fast consolidating its economic status as the regional investment hotbed, powered by the pioneering development initiatives undertaken by the economic cities in the Kingdom. As the first multifaceted economic city, KAEC has set a strong foundation for inward investment in a number of high-growth sectors. The aluminum smelter complex will be another magnet for industries exploring the investment options provided by KAEC.”
Al-Rasheed said “the aluminum smelter complex at KAEC will be among the largest such facilities in the region and will create initially over 2,500 direct and 5,000 indirect jobs, and “with the potential to double production capacity, the plant will also drive downstream industrial investment to KAEC, thus creating a dynamic industrial investment hub in the region.”
He added: “Aluminum industry is one of the fastest-growing sectors with huge potential for job creation directly and through ancillary industries. By setting up the smelter complex, we are also reiterating on our commitment to the Kingdom to create more job opportunities for the Saudi population.”
Al-Rasheed further said: “KAEC is the single largest private sector development in the region, and to further promote its objectives, we are forming strong public-private partnerships that power our growth,” adding that “the partnership with EMAL International, which represents the joining hands of two of the UAE’s leading names in the industry and investment, will enable KAEC to deliver a strong foundation of growth for potential investors,” he said.
“Dubal’s involvement in this project is extremely gratifying, as it pays tribute to the wealth of experience and advanced technologies developed by our company over the past 28 years,” Kalban said.
When asked about the progress at the KAEC, Al-Dabagh said that “development at the KAEC is going on in phases and we are ensuring that the various components in the city are developed according to schedule agreed upon between the developers and the regulator which is the investment authority (SAGIA). We are monitoring the schedule and so far the KAEC has been on schedule.” “Lets not forget,” he added, “that that we are talking (not only) about 168-million square meter project, but we are also talking about nearly $100 billion worth of investments involved in the project.”
Al-Dabagh stressed that “this is no way a simple project. The infrastructure development is something that is not so visible despite the components that are developed now because of the size of the city. We really don’t see the volume of the scale. But we are not concentrated in one point. For instance, we have only 1,000 equipment in this project and tens of thousands of workers and more being mobilized, so the scale is great. However, because of the size of the city, we will not have the feel of this project.”
