Dubal takes 20% stake in Sinoway calciner project

The new venture, known as Sinoway Carbon Company Limited (Sinoway), entails the construction of a 560,000 tonnes per annum calciner in Shandong, China.

The end-product of the calcination process, calcined petroleum coke (CPC), is a strategic raw material for the aluminium smelting industry, where it is used in the manufacture of carbon anodes for the electrolytic process of extracting the metal from its ore. Dubal will be entitled to an annual off-take volume of CPC for its smelting operations

The Sinoway calciner is being built in two equal phases (i.e. 280,000 tonnes per phase). Construction of the first phase is at an advanced stage: completion is scheduled for May this year. Phase two is scheduled for completion in the fourth quarter of 2013.

The plant will employ Chinese shaft technology - a well-proven, simple-to-install, easy-to-operate system that gives better yield than other technologies at substantially lower capital- and operating expense. China has a surplus supply of green petroleum coke (GPC), a by-product of oil refining and the raw material consumed by a calciner. Indeed, China currently produces more than 40% of annual global GPC/CPC production, with several GPC refineries being in close proximity to the Sinoway development site.

Commenting on the deal, Abdulla Kalban, President & CEO, said, "Dubal's investment in Sinoway represents a strategic opportunity to mitigate the company's supply and quality concerns, thus contributing to business continuity."

"The aluminium smelting process is extremely sensitive to CPC quality, especially in terms of anode life and sulphur emissions. Good quality GPC is necessary to produce the quality of CPC required by Dubal, and China's GPC is well within this range," Kalban explained.

He added, "At present, Dubal sources its CPC supply from six calciners, most of which source their GPC from China."

"A relatively restricted supply of anode grade GPC worldwide is, however, pushing-up the associated CPC prices. CPC is one of the main drivers for cost of production, hence an important factor in the business equation. With a secure supply of suitable quality CPC from Sinoway calciner, Dubal will be well placed to counter this trend, with direct benefits to the bottom-line," he concluded.