Sojitz Corporation


Receipt of Order for Power Converter Equipment for One of the World's Largest Aluminium Smelters

Sep. 7, 2003

TOKYO(as of September 7, 2003)--Nissho Iwai Corporation, in collaboration with several Japanese companies, has received an order for power converter equipment and contract construction for a transformer station and related facilities from Aluminium Bahrain B.S.C. (hereafter called ALBA) of Bahrain, who's aluminium smelter is one of the largest in the world. The order, with a total value of approximately 15 billion yen, will be the first for a Japanese company to deliver equipment to ALBA.

The equipment to be delivered is power equipment manufactured by FUJI ELECTRIC SYSTEMS Co., Ltd. (Head Office: Chiyoda-ku, Tokyo; President: Katsuhiro Ose) and Japan AE Power Systems Corporation (Head Office: Minato-ku, Tokyo; President and Director: Masakazu Mori). A lump sum contract for power transmission and distribution equipment has been received jointly with Emirates Trading Agency L.L.C. in the United Arab Emirates.

As a single aluminium smelter, ALBA is one of the largest in the world, with a current production capacity of over 500,000 tons per annum. The company is carrying out production line expansion work to increase its annual production capacity to 800,000 tons, which work is scheduled for completion in June 2005. Nissho Iwai annually purchases over 60,000 tons of the aluminium produced by ALBA, and has the greatest transactional relationship of the companies located outside the Middle East. Such facts lead to the conclusion of this contract.

Bahrain is promoting diversification of industries replacing oil and gas, and aims to encourage investments in and promotion of such industries, and to create new employment opportunities. The country is also focusing its efforts on the aluminium refining business as part of its fostering of local industries. There is an active demand for aluminium worldwide, for such applications as the manufacture of lighter automobiles, rustproof building materials, canning, high-tech transport aircrafts, etc. Since major smelters are located in Europe and the United States where the electricity rates are high, attention is being focused on the development of aluminium refineries in the Middle East, where the electricity rates which account for over half the cost of aluminium are inexpensive.

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