Nanshan Aluminum International (stock code: 02610) has announced that, in order to further enhance the Group's competitiveness, drive sustainable growth, and build synergistic effects across the upstream and downstream industrial chain, the Group intends to commence operations in the aluminum electrolysis sector, along with related raw materials and supporting businesses.
The Group plans to initiate preparatory work for a 250,000-ton annual aluminum electrolysis project in 2026, with a preliminary estimated investment of approximately US$436.6 million over a two-year construction period. This project is proposed to be located in the Karang Batuang Special Economic Zone on Indonesia's Bintan Island, where the Group's alumina plant is situated, and will require environmental and/or construction permits from the relevant local authorities. Looking at medium to long-term development, the Group also intends to formulate plans for an additional project with an annual capacity of 500,000 tons of aluminum electrolysis, aiming to further expand the Group's aluminum electrolysis production scale and extend its related business operations. At a strategic level, the Group plans to gradually increase its aluminum electrolysis capacity to achieve a balanced production match between its aluminum electrolysis and alumina outputs. Through the synergistic development of upstream and downstream capacities, the Group will continuously optimize its industrial structure, leverage the advantages of integrated operations, and enhance overall operational efficiency and profitability.
The formulation of the aforementioned strategic plan is based on several favorable factors. Firstly, the Group currently has ample land supply to meet the site requirements for new aluminum electrolysis projects. Secondly, the Group benefits from a superior geographical location, positioned as a gateway between the Pacific and Indian Oceans (including the Straits of Malacca and Singapore). The Strait of Malacca is one of the world's busiest and highest-traffic commercial shipping lanes. Proximity to the Southeast Asian economic sphere provides convenient access to the Eurasian continent, encompassing Europe, India, the Middle East, and other regions. This will facilitate the Group's development of overseas markets and expansion of its customer base.
Leveraging its existing alumina business, the Group will actively promote diversified development. As a downstream segment of alumina, aluminum electrolysis will create industrial synergies with the Group's current operations. Based on the Group's understanding, there is significant growth in market demand for aluminum electrolysis, with prices continuing to rise; developing this business will allow the Group to capitalize on market opportunities and enhance profitability. By expanding into aluminum electrolysis and related activities, the Group will achieve an extension of its industrial chain, further diversifying its revenue streams and strengthening its risk resilience.
Beyond the above, the Group's successful experience in constructing and operating alumina projects in Indonesia will provide valuable insights for the preparation and operation of the aluminum electrolysis project, thereby effectively mitigating project risks and improving implementation efficiency. The Group can also utilize the industry resources and specialized technical support of its controlling shareholder, injecting strong momentum into the planning, construction, and operation of the aluminum electrolysis and related businesses.
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