Pavlodar Plant Signs 300 Million Euro Deal for Aluminium Supply

ASTANA – The Eurasian Resources Group (ERG), a leading diversified natural resources company, and VTB Group have entered into a strategically important deal in the amount of 300 million euros to finance a six-year aluminium supply.

According to the ERG Communications Department, VTB Capital has issued an advance payment for aluminium supply totalling 660,000 tonnes over the life of the loan to the Kazakhstan Electrolysis Plant (KEP) located in Pavlodar. VTB Capital has already signed long-term contracts for the implementation of this metal with end users, reported

The partners have developed a hedge strategy against falling aluminium prices and the KEP will set the selling price of aluminium in a particular corridor, fixing it at the level not lower than the boundaries of the corridor to stabilise cash flows.

“This deal is the first long-term financing of the Kazakhstan Electrolysis Plant ensuring the stability of the enterprise and guaranteed markets products throughout the term of the agreement. We are the only aluminium producer producing the metal of the highest grade in Kazakhstan,” said CEO of Eurasian Resources Group Benedict Sobotka.

According to head of the bank’s Credit Department, Senior Vice President of VTB Bank Vitaly Buzoverya, operations in the commodities market is one of the priorities of the company.

“The deal will further strengthen our position in the commodities segment. Our work strategy in this market involves expanding the range of goods and services provided by VTB customers,” she said.

KEP’s production capacity accounts to 250,000 tonnes of aluminium per year. The company is listed on the London Mercantile Exchange brand. Its production technology is characterised by high innovation and an environmentally friendly approach. With these indicators, the plant is included in the world’s top ten aluminium giants among 200 companies.

A reduction in specific consumption of electricity for electrolytic aluminium by 1.4 percent below the standard value and 2.7 percent less than the project value was achieved at the KEP since the energy management system ISO 50001 series was launched in 2014 and due to the work of energy saving from the Aksu power station. This indicator is one of the best in the world.

Overall, the energy consumption for production of one tonne of primary aluminium for the first nine years of the company’s work was reduced threefold. The plant also produces its own anodes used in aluminium production, which gives an additional opportunity to reduce the cost of metal.

Get The Astana Times stories sent directly to you! Sign up via the website or subscribe to our Twitter, Facebook, Instagram, Telegram, YouTube and Tiktok!