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Netherlands-based aluminum producer Vimetco NV (VICO.LN) has restarted production at its Alum Tulcea alumina refinery in Romania, the company said Friday.
Production at the refinery was suspended in February 2007 to carry out modernization, which has now been completed, Vimetco noted.
The refinery has the capacity to produce 600,000 metric tons of alumina a year.
"The company has replaced part of the existing equipment in order to make the production process more efficient and also to be in compliance with the European norms on environment protection," the company said in a statement. "After the implementation of the upgrading program, the technological flow has been optimized, resulting in competitive production costs," it added.
The company's Chief Executive Frank Muller said Vimetco is continuing to pursue its long-term strategy despite the global economic downturn, which saw aluminum prices slump after demand in its main consumption markets of construction and automotives was crimped.
Like other aluminum producers, Vimetco responded by cutting output and reducing capital expenditure at its operations in China and Romania. Vimetco stopped a production line in Romania and reduced staff levels there by about 40%.
Muller told Dow Jones Newswires in an interview recently that Vimetco is producing about 60,000 tons of aluminum less in Romania this year, with 2009 output budgeted at around 201,000 tons.
Vimetco has an overall aluminum production capacity of around 930,000 tons, of which 265,000 tons is in Romania.
"A key element of [our] strategy involves achieving full vertical integration across the group's operations by controlling the entire chain supply, from bauxite to high-added-value products," Muller said.
"Reopening the alumina refinery in Tulcea also means that Alro secures the ongoing production of alumina which facilitates continued aluminum production while ensuring security of supply."
Four tons of bauxite makes around two tons of alumina, which in turn makes one ton of aluminum metal.
Alum Tulcea is a wholly owned subsidiary of Vimetco's Alro SA, the largest aluminum producer in Central and Eastern Europe.
Alro also operates an aluminum smelter in Slatina, which produced 288,000 tons of cast products and 35,000 tons of processed products in 2008.
-By Andrea Hotter, Dow Jones Newswires; +44 (0)20 7842 9413; andrea.hotter@dowjones.com
(END) Dow Jones Newswires
10-09-09 0407ET
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