Dec 22 2006
Hydro and Tajik Aluminium Plant of Tajikistan have entered into new commercial arrangements. These incorporate a final resolution of the recent Award of the London Court of International Arbitration, which related to the supply of alumina and aluminium between the parties in the latter half of 2004.
As part of the arrangements, TadAZ will deliver to Hydro between 120,000 and 200,000 tonnes of primary aluminium per year over a four year period and Hydro will supply 150,000 tonnes of alumina to TadAZ.
Hydro will also provide technical assistance to TadAZ, with a view to improving the efficiency of the smelter and its environmental and health and safety performance, as well as corporate and social responsibility issues.
According to the World Bank Group and EBRD, with this agreement, the perceived risk of doing business in Tajikistan will be reduced for international investors. Both TadAZ and Hydro believe that with this agreement they will be able to receive further support from these institutions.
"We are pleased to have resolved our differences with TadAZ and to have reached a positive new commercial arrangement with TadAZ," said Torstein Dale Sjøtveit, Executive Vice President of Hydro's Aluminium Metal business area.
"We see this as a mutually beneficial agreement, where Hydro will receive the primary aluminium needed for our remelting operations and at the same time give assistance to TadAZ regarding operational issues. Hydro is committed to supporting TadAZ to increase their efficiency and production for the benefit of the Republic of Tajikistan," commented Simon Storesund, Senior Vice President of Hydro.
"We are delighted to have entered into a four year commercial agreement with Hydro. We are also pleased to announce that a settlement has been reached that enables both parties to work together on mutually beneficial commercial arrangements in the coming years," said Sherali Kabirov, TadAZ's Deputy Director. "TadAZ regards Hydro as an important strategic partner in the aluminium industry. Hydro's commitment to its relationship with TadAZ demonstrates TadAZ's ability to trade successfully with international counterparties."
Tajik Aluminium Plant, TadAZ, consisting predominantly of plants in the town of Tursunzade and owned by the Government of the Republic of Tajikistan, is the largest industrial enterprise in Tajikistan, accounting for a significant proportion of the country's GDP and employing more than 12,000 people.