National Aluminium Company Ltd (NALCO) is considering a new 0.5 million tonne per annum aluminium smelter in Andhra Pradesh as it seeks to convert all of its expanded alumina capacity into aluminium, the company’s CMD B P Singh said on September 29.
The proposed smelter would allow NALCO to use its entire planned alumina production capacity of 3.1 million tonnes per annum for its own aluminium production. The company currently has alumina capacity of 2.1 million tonnes per annum, which is expected to rise after a new refinery is commissioned by financial year 2027-28.
NALCO currently exports about 0.13 million tonnes of alumina. Singh said the company intends to move towards producing value-added aluminium instead, in line with the stated vision of the Ministry of Mines. The proposed Andhra Pradesh facility is being considered as part of that expansion strategy.
Speaking on the sidelines of a roadshow for the Angul Aluminium industrial park, Singh said discussions were under way with the Andhra Pradesh government. The company has not yet identified land for the project, and a formal announcement will follow only after the land issue is resolved.
A 0.5 million tonne aluminium smelter is estimated to require an investment of about Rs 18,000 crore, according to Singh. The facility would also need around 1,000 megawatts of power, involving an additional estimated cost of Rs 11,000 crore. The scale of the proposed project makes land allocation and power availability key requirements for its development.
NALCO’s existing aluminium smelter capacity is 0.46 million tonnes per annum. In September, the company signed a technology licensing agreement with UAE-based Emirates Global Aluminium to use its DX+ Ultra smelting technology for a 0.5 million tonne per annum brownfield expansion at Angul in Odisha.
The Andhra Pradesh project would be separate from NALCO’s announced capital expenditure of Rs 25,000 crore through 2031, Singh said. The company is also working with a consultant on a product strategy covering aerospace and other specialised applications.
NALCO is targeting total aluminium capacity of about 1.5 million tonnes. Further details on the Andhra Pradesh location, project schedule, land requirement and implementation plan will depend on the company’s discussions with the state government and a subsequent formal announcement.
