Dec 28 (Reuters) – The world’s top private aluminium producer China Hongqiao Group 1378.HK plans to move 1.93 million tonnes of aluminium capacity to the Honghe prefecture in southwest Yunnan province, a local government notice showed.
According to a statement issued by the Yunnan industry department, the aluminium giant aims to relocate capacity from six projects in its Shandong units to Yunnan Honghe New Material Co via a capacity swap plan.
Hongqiao had pledged to move around 2 million tonnes of its annual capacity from eastern Shandong province to Yunnan’s Wenshan prefecture for easier access to hydropower, a cleaner source than coal. Reuters reported in May that the company was considering relocating more capacity to Honghe prefecture.
That suggested more than 60% of the company’s 6.46 million tonnes of licensed annual primary aluminium capacity will be located in Yunnan.
Yunnan is home to around 10% of China’s aluminium capacity. It depends on hydropower for 75% of its electricity, though output from hydro plants had been falling for two straight months in October and November both on a monthly and annual basis.
The relocation plan was postponed due to power curbs imposed by the provincial government earlier this year, though the company had been in communication with authorities to make it happen, Hongqiao Chairman Zhang Bo said in October.
The project, which is open to public feedback until January 7, is expected to start construction in March and will be put into production in Mar. 2023, the statement showed.
(Reporting by Min Zhang and Tom Daly; Editing by Raju Gopalakrishnan)
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