Press Metal in RM2b smelter expansion plan

Press Metal Bhd will invest RM2bil in the Phase 3 expansion of its aluminium smelter project to raise production capacity, said group chief executive officer Datuk Paul Koon Poh Keong.

He said the additional capital injection would bring the company’s total investment in aluminium smelting facilities in Sarawak to RM5.5bil.

The Phase 3 expansion will be located next to the company’s existing smelter in Bintulu’s Samalaju Industrial Park within the Sarawak Corridor of Renewable Energy (SCORE). Press Metal also owns an aluminium smelter in Mukah. Both smelters are currently in full operations.

“Every year, we (Press Metal) generate more than US$1bil in aluminium exports for the country,” said Koon in a presentation at a SCORE forum. The forum was part of the three-day International Energy Week 2015 hosted by the Sarawak Government.

Regional Corridor Development Authority CEO Tan Sri Wilson Daya Dandot chaired the session, which featured two other panel speakers – Sarawak Planning Unit director Datuk Ismawi Ismuni and Sakura Ferro Alloys general manager Chris Rowe.

Stage one of the phase III project is expected to be operational by the last quarter of 2015 and stage two by the first quarter of 2018. Upon completion of the expansion project, Press Metal will raise its total smelting capacity to 766,000 tonnes from 440,000 tonnes per annum to become the largest smelter in South-East Asia.

The existing Samalaju smelter has an installed capacity of 320,000 tonnes per annum, while the Mukah smelter has a designed capacity of 120,000 tonnes per annum.

Last month, Press Metal signed a power purchase agreement with Syarikat Sesco Bhd (owned by Sarawak Energy Bhd) for an additional 500MW of power for a 25-year period for the proposed new smelter.

Koon said Press Metal currently produced aluminium ingots and billets, which are exported to various countries, including Mexico and North America.

According to him, aluminium is today more widely used, including in the automotive industry in the United States and in window buildings due to its energy-saving advantage.

He said as the aluminium smelting industry could generate many spin-off activities, “we are aggressively looking at getting downstream industries to be players in Sarawak”.

Koon said if aluminium downstream industries currently operating in Peninsular Malaysia could build plants next to Press Metal’s smelter, they would be able to buy molten aluminium instead of having to purchase aluminium ingots first and then melt them down for processing activities, thereby saving costs.