Qatalum CEO Tom Petter Johansen says the cost of producing aluminium is not influenced by oil prices, and it’s rather the opposite.

By Peter Alagos/Business Reporter



The decline in oil prices has not affected the demand for aluminium in the GCC region, particularly in Qatar, Qatar Aluminum (Qatalum) chairman Abdulrahman Ahmed al-Shaibi said.
Speaking at the “1st Gulf Aluminium Casthouse (GulfCast) Conference” yesterday at the Sharq Village & Spa here, al-Shaibi stressed that global demand for aluminium is even expected to increase.
“The growth in aluminium demand globally over the last few years has been around 6% and this rate is expected to continue in the near future. Importantly, we have seen this demand has not been affected by the decline in oil prices,” al-Shaibi said.
Qatalum CEO Tom Petter Johansen explained to Gulf Times that the consumption of aluminium “is not directly influenced by oil prices anymore.”
“The other part of it is that the cost of producing aluminium is not influenced by oil prices, and it’s rather the opposite. The most important energy source for aluminium today is coal. Take for example, China. Their aluminium industry is fuelled by coal.
“The competitiveness of aluminium as a material is increasing compared to other materials due to lower energy prices,” Johansen stressed.
Also, Johansen underlined the role of the global automotive industry, which played a significant role in the increase in the demand for aluminium.
“We also see that with lower oil prices, the automotive industry is booming. The car manufacturing industry is doing quite well and the consumption of aluminium in this sector is increasing,” he said.
He also explained that automobile parts made from steel are gradually being replaced with aluminium, increasing its competitiveness compared to other materials used in the automotive industry.
Describing aluminium as an energy-intensive industry, Johansen noted that aluminium still enjoys an advantage over other industries due to competitive energy prices.
“The reason why we have the 10% of the global aluminium production in the Gulf region is because of competitive energy prices,” he said.
According to Johansen, Qatalum produced 612,000 tonnes of aluminium in 2014. This year, the company’s goal is to optimise processes to reduce cost.
“What we have been doing since 2011 was to optimise our processes by using this production system called the ‘Qatalum Improvement Programme,’ which was started in 2013 and aims to reduce cash costs by $150 per tonne, and that’s a lot.
“By the end of 2014, we have already reached $124 per tonnes in cost improvement. So, we are trying to improve our cost position, utilise creep capacity, and increase volume slowly,” Johansen said.


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