Coega beats Aussie bidders to R16-billion smelter

Ed Richardson THE COEGA Industrial Development Zone (IDZ) has been confirmed as the preferred site for a R16-billion aluminium smelter planned by French company Pechiney. This places the Eastern Cape ahead of Australia, which is also vying for the investment. Speaking at a media conference in Johannesburg last week, Pechiney chairman and chief executive Jean-Pierre Rodier said Coega was by far the preferred location. He described it as "better than the others," and "ahead of schedule compared to other locations." Rodier said he was "more than 50%" sure that the smelter would be sited at Coega. Work has already begun on the infrastructure of the Coega IDZ, with construction of the new R2,6-billion deep-water port of Ngqura due to start soon after the tenders have been awarded in July 2002. The proposed smelter will produce 450 000 tons of primary aluminium a year. Construction, which would begin in early 2003, would take 26 months. An estimated 4 500 workers will be employed during the period, peaking at six thousand. Some one thousand permanent jobs would be created at the plant itself, with 200 sub-contractors being employed. Rodier said Pechiney, in partnership with Imbali Resources, would take a 50% stake in the project. Public and private sector partners would hold the remaining 50%. Both Eskom and the Industrial Development Corporation have expressed interest in taking shares in the project. Speaking at the Gordon Institute for Business Science, Eskom finance director Willem Kok said Eskom would be keen to see an investment in a new smelter at Coega, as this would establish an important new electricity consumer for the utility. The smelter would more than double the electricity consumption by the Nelson Mandela Metro. According to Rodier, Pechiney had "not received any negative signs environmentally" in its environmental impact study into the Coega investment. The Coega zone itself has been given the green light by the Department of Environmental Affairs and Tourism, which has issued a final Record of Decision with regard to the port and the industrial zone. In terms of the RoD, the land can be rezoned from agricultural use and work may start on the port and bulk infrastructure.