Erwin, Alcan in talks on Coega deal

Posted On Wednesday, 21 January 2004 02:00 Published by eProp Commercial Property News
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The trade and industry department has confirmed that that minister Alec Erwin met representatives from Alcan and Pechiney, who visited SA last week, to assess the merits of Pechiney's proposed $2,2bn aluminium smelter at Coega.

Alec Erwin

The minister's personal involvement in the matter signals the importance of the mooted project to SA.

The project is being reconsidered, following Alcan's takeover of Pechiney.

Canadian company Alcan said this week that no decision had been made on any of Pechiney's current investments.

Several competing projects were being reconsidered. "The company will announce in due course any decision taken in relation to this review," said Alcan.

The aluminium smelter project would represent the largest single foreign direct investment in SA to date and would provide a substantial boost to the Eastern Cape economy.

It would also validate government's multibillion-rand investment in the Coega industrial development zone. Questions have been raised about the viability of the project, which BusinessMap's Reg Rumney has said is politically driven.

The department said Erwin briefed Alcan on the investment environment in SA and shared "information relevant to the company's decision to invest in the aluminium smelter".

Alcan and Pechiney officials also met the department's director-general, Alistair Ruiters, Industrial Development Corporation (IDC) officials, Eskom and National Ports Authority.

Alcan also said that pursuant to its continuing review of Pechiney assets, an impairment charge of à 45m would be recorded for the costs incurred for the Coega smelter project up to September 2003. Project costs incurred subsequent to September 30 would be charged to income.

Pechiney planned to take a 49% stake in the project, with the IDC and Eskom each taking stakes of 12,5%.

Last modified on Thursday, 26 June 2014 19:08

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