The planned aluminum smelter plant joint venture between Saudi Arabian Mining Co. (Maaden) and Rio Tinto Alcan will cost by 40 percent more to $10.5 billion from the initial estimated spending, Maaden's Chief Executive Officer Abdullah Dabbagh said on Sunday. “The aluminum project with Rio Tinto Alcan is worth $10.5 billion and this has been reconfigured to produce 750,000 tons of aluminum (per year) rather than the 650,000 tons we started with,” he said. The project will include bauxite mining, alumina refining, power generation and aluminum smelting. Production will start in 2012, Dabbagh said. Rio Tinto Ltd is competing with international mining and aluminum conglomerates to gain access to the Middle East's vast energy resources to develop smelters as costs surge in North America and Europe. The Maaden project was originally expected to cost $7.5 billion, he said. Saudi Arabia, the world's largest oil exporter, wants to develop its largely untapped mineral resources in an effort to diversify away from its dependence on crude exports and to create more jobs for its rising young population. Maaden, which lists on the Saudi Tadawul stock market Monday, has secured $2.3 billion in international loans for its phosphate project worth $5.56 billion, a joint venture with Saudi Basic Industries Corp. The project is on track to be completed by 2010. “This project is already financed. Almost all of the contracts have been signed and 85 percent of contracts are lump-sum term key contracts,” Dabbagh said. Maaden is the first mining company to list on Saudi's bourse.
