19 SEPTEMBER 2011China Aluminium Network
Rio Tinto closer to Malaysia power price deal to push aluminium smelter project
Edited by : AL CIRCLE
1 min read
AFTER protracted delays, mining giant Rio Tinto and its Malaysian partner are inching towards an agreement on the price they will pay for electricity to power their $US2 billion ($1.9bn) aluminium smelter in East Malaysia.
According to sources, negotiations have been held up because the Malaysian government was selling its interest in the huge Bakun hydroelectric plant to the regional Sarawak government.
With the Bakun sale process complete, Rio and its partner can start working towards their own agreement with the Sarawak government on the price of electricity to be supplied from Bakun.
Sarawak Aluminium Company, a 60-40 joint venture between Rio and Cahya Mata Sarawak, was given a manufacturing licence by the Malaysian Industrial Development Authority in March 2008.
"They naturally want cheap power, and they are still talking to our people on price," Malaysia's International Trade and Industry Minister, Mustapa Mohamed, said of the proposal's progress.
The prospect of cheap electricity, the main cost of running smelters, has attracted other heavy power users to Sarawak.
According to sources, negotiations have been held up because the Malaysian government was selling its interest in the huge Bakun hydroelectric plant to the regional Sarawak government.
With the Bakun sale process complete, Rio and its partner can start working towards their own agreement with the Sarawak government on the price of electricity to be supplied from Bakun.
Sarawak Aluminium Company, a 60-40 joint venture between Rio and Cahya Mata Sarawak, was given a manufacturing licence by the Malaysian Industrial Development Authority in March 2008.
"They naturally want cheap power, and they are still talking to our people on price," Malaysia's International Trade and Industry Minister, Mustapa Mohamed, said of the proposal's progress.
The prospect of cheap electricity, the main cost of running smelters, has attracted other heavy power users to Sarawak.
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