Vi Holding on cusp of unprecedented China project

MOSCOW  –  Vi Holding plans to complete construction and fully start up the vertically integrated Yulian complex in Henan province for hot and cold rolling of aluminum alloys, with capacity for 600,000 tons and 400,000 tons respectively, in the second half of 2015.

Launch of the Yulian facility will mark the concluding phase of the project to create a group of enterprises for high level aluminum processing in China that Vi Holding began in 2006. Overall investment now totals $3.3 billion, including $1.2 billion provided by shareholders, with the rest financed with Chinese bank loans and reinvested earnings.

Vi Holding's Chinese complex currently has capacity to produce about 800,000 tons of highly refined aluminum, including 600,000 tons of hot roll, 60,000 tons of flat products and 150,000 tons of anodes. It has capacity to produce 750,000 tons of primary aluminum for refining and 420,000 tons of castings.

A vertically integrated production complex has been created, including coal production, electricity generation, output of prebaked anodes, electric aluminum and alloys and high level processing of primary aluminum into high-tech products. The Yulian complex is not an aluminum smelter, but rather a facility for producing high-tech products from aluminum, Vi Holding management said.

Electricity is supplied from power plants with 1,500 megawatts of combined capacity, the fuel for which is supplied from nine nearby company-owned mines with 150 million tons of proven reserves. Vi Holding employs about 16,000 people in China.

The complex is located in two industrial parks, in the cities of Gongyi and Linzhou. It is part of Henan Yulian Energy Group, which is 97% owned by Vimetco, which in turn is controlled by Vi Holding.

Vi Holding, which until now had developed the project without any state support, expects to receive backing from  Chinese authorities under China's policy of stimulating creation of high-tech integrated production.

In addition to its investment in the aluminum sector, it is engaged in developing the Darwendale platinum deposit in Zimbabwe, one of the biggest platinum deposits in the world. It also has property development projects in Moscow.