01 06

Origins of the aluminum industry

RUSAL basically became the successor of the Russian and Soviet aluminium industry, having united not only leading facilities that produced aluminium, alumina and a wide range of products, but also the powerful scientific and research potential of the industry. The aluminium industry of Russia, which dates back to the XIX century, received new impetus for development thanks to RUSAL in the XXI century. Implementing its cutting-edge technologies and also launching unique types of products has allowed RUSAL to become an innovative industry leader.


In Sergiev Posad, Moscow Governorate, the industrialist А. Novoveisky founded the first aluminium smelter in Russia, which produced the metal chemically according to the Sainte-Claire Deville method. and Russia became the third country in the world to produce aluminium. The raw material for production was clay delivered from the Chernigov Governorate. The smelter was around until 1889, when it was shut down as it was unable to compete with foreign suppliers of aluminium.


At the Tentelevsky chemical plant in Saint Petersburg, the Austrian chemist Carl Josef Bayer invented an advanced and cost-efficient method of producing aluminium oxide – alumina. During an experiment, the scientist added bauxite to alkaline liquor and heated it in a closed vessel. The bauxite partially dissolved, and the aluminium contained in it passed into alkaline liquor. Today, the 'Bayer method' is one of the most common technologies for producing alumina both in Russia and abroad.


At the Krasny Vyborzhets plant in Leningrad, a pilot section for producing aluminium was launched, and the first experimental reduction cell was installed. The first ingot of Soviet aluminium was presented at the regional party conference that same year. A year later, the Council of Labour and Defence decided to build aluminium smelters on the base of Dneprostroy and Volkhovstroy.


On May 14, the first aluminium smelter with an annual capacity of 5 thousand tonnes of metal per year was launched in Volkhov. A year later, the Dneprovsky Aluminium Smelter with a capacity of 15 thousand tonnes was put into operation in Zaporozhye. In the 1930s, bauxite mining was started at the North Ural Bauxite Mine, the South Ural Bauxite Mine was launched, the Tikhvin Alumina Refinery, and the first stage of the Ural Aluminium Smelter in Kamensk-Uralsky were put into operation.


In record-breaking time, the first aluminium smelter in Siberia – the Novokuznetsk Aluminium Smelter (in those days – the Stalin Aluminium Smelter) – was built and put into operation. Supplies of metal from the Ural Aluminium Smelter and the Novokuznetsk Aluminium Smelter ensured smooth operation of the country's military industry, primarily the aviation and shipbuilding sectors. Simultaneously, a production facility was built in Krasnoturyinsk: the Bogoslovsky Aluminium Smelter produced the first metal in May 1945.


A smelter was launched in Kandalaksha, which still remains the world's only aluminium production facility beyond the Arctic circle. In the 1950s, aluminium smelters were also put into operation in Nadvoitsy (1954) and Volgograd (1959). The USSR, for the first time in the world practice, mastered production of alumina from nepheline raw materials – this was the technology used by the Volkhov smelter and Pikalyovo refinery in the Leningrad region. Later, it would also be used at the Achinsk Alumina Refinery.


On July 25, the first metal was produced at the Bratsk Aluminium Smelter, the largest in the USSR and the world. It was possible to start up this facility for almost 1 mln tonnes due to the construction of entire hydraulic power plant cascades on Siberian rivers. In the 1950s and 60s, dams of the Irkutsk, Bratsk, Ust-Ilimsk HPPs were built on the Angara, and dams of the Sayano-Shushenskaya, Mainskaya and Krasnoyarsk HPPs were built on the Yenisei. The availability of affordable electricity allowed for the construction of two more aluminium smelters in Siberia – the Irkutsk smelter (1962) and the Krasnoyarsk smelter (1964).


The Sayanogorsk Aluminium Smelter was launched in Khakasia, at that time the most advanced and furnished with the best equipment. The Sayanogorsk Aluminium Smelter became the last production facility of the Soviet aluminium industry. The next aluminium smelter would be built in Russia some 20 years later – not far from the Sayanogorsk Aluminium Smelter. By the mid-1980s, the country's aluminium consumption reached a record of 17 kg per capita per year.



Sayanogorsk commissioned the largest foil rolling facility in Russia, SAYANAL, built out of profits coming from the Sayanogorsk Aluminium Smelter, on the initiative of the smelter's Chief Executive Officer Oleg Deripaska. SAYANAL installed equipment of the Italian FATA engineering company and U.S. Reynolds Metals Company, one of the largest global producers of aluminium-based packaging materials.


Siberian Aluminium was established, which included the Sayanogorsk Aluminium Smelter, SAYANAL, and the Dmitrov Pilot Aluminium Can Sheet Plant (Moscow region). SIBAL began construction of Rostar – an aluminium can production plant. By the late 1990s, the Group also included the Samara Metallurgical Plant, the largest producer of aluminium rolled products in Europe, and one of the largest alumina suppliers in the post-Soviet space – the Nikolaev Alumina Refinery.



Siberian Aluminium (Oleg Deripaska) and Millhouse Capital (Roman Abramovich) announced the merger of their assets and the creation of RUSAL. In addition to SIBAL's production facilities, it included the Krasnoyarsk and Bratsk Aluminium Smelters, Armenal foil plant. Thus, RUSAL represented ¾ of Russian aluminium production, and became one of the three world leaders in the industry (along with Alcoa in the USA and Alcan in Canada). 


RUSAL's assets expanded with the Belaya Kalitva Metallurgical Production Association (BKMPO) and the Novokuznetsk Aluminium Smelter. The Company began actively operating abroad. It acquired two production sites in Guinea: the Friguia bauxite and alumina complex and the CBK mining complex. Over the next three years RUSAL began exploring bauxite deposits in Guyana where the Guyana bauxite company (CBG) was setup.


Experts of the RUSAL Engineering and Technology Centre (ETC) complete work on a unique aluminium production technology – RA-300, which allows reducing electricity consumption and increasing the service life of reduction cells. New reduction cells operating at an amperage of 320 kA were put into operation at the Sayanogorsk Aluminium Smelter. Three years later RUSAL Sayanogorsk also began utilising the next generation RA-400 reduction cells, which also had been designed by ETC technicians. That same year, RUSAL acquired the Russian National Aluminium and Magnesium Institute (VAMI), which was put in charge of design works as part of the Company's investment and construction projects.


The Company obtains permission to develop bauxite deposits in Guyana (Latin America). As part of the agreement between RUSAL and the Government of Guyana, a new enterprise - the Company of Bauxite of Guyana (KBG) was established.


In 2005, RUSAL acquired from Kaiser Aluminium a 20% stake in Queensland Alumina Limited (QAL), Australia's second largest alumina refinery.

RUSAL's ITC is also finalizing a project to develop a new 400kA electrolyser. In 2005, RA-400 electrolysers were commissioned at the Sayanogorsk aluminium smelter.

The sale of two rolling mills - SMZ and BKMPO - to Alcoa is nearing completion.



The Company continued to expand its raw material and production base: it purchased a controlling stake in Eurallumina (Italy), a cathode plant in Shanxi, China, a controlling stake in the Aroaima Mining Company (Guyana), and the Boksitogorsk Aluminium Smelter. In December 2006, RUSAL launched the Khakas Aluminium Smelter, the first production facility in the industry built in Russia after a 20-year hiatus.


As a result of the merger of RUSAL, SUAL and Glencore (Switzerland), United Company RUSAL was created, the world's largest aluminium producer. RUSAL began implementing two major projects: the construction of the Boguchansky Aluminium Smelter and the construction of the Taishet Aluminium smelter.


RUSAL purchased a stake of more than 25% in Norilsk Nickel, the world's largest producer of nickel and palladium and one of the largest producers of platinum and copper. The company then teamed up with Samruk holding to set up a joint oil mining company operating in the Ekibastuz coal deposit in Kazakhstan and purchased China-based cathode subassembly manufacturing facility Taigu Cathode. In Nigeria, RUSAL launched production at the ALSCON facility.


The company ran into some serious difficulties during the late 2000s global economic crisis. Demand for aluminium plummeted to a historic low and so did the price, which naturally delivered a major blow to the financial state of the company, leading to tensions with creditors. A set of measures aimed at cutting costs, optimising production and reducing production costs allowed the company to weather out the crisis with minimal losses while laying the foundation for further development and diversification of the business. In October through December 2009, RUSAL signed a number of agreements with Russian and foreign banks to restructure the debt totally amounting to USD 16.8 billion. Thus, the company's debt to a number of foreign banks amounting to USD 7.4 billion was restructured for a period of four years with an option to extend the deal for another three years. A total of 70 credit institutions took part in the restructuring deal with some 50 loan agreements being revised.

Despite the problems encountered during the crisis, in July 2009, RUSAL managed to complete the environmental modernisation of the Krasnoyarsk Aluminium Smelter, which had been started in 2004. The last stage of the project involved the launch of a new gas treatment centre utilising the new dry gas scrubbing method.


RUSAL shares were offered on major global and Russian stock exchanges: the Hong Kong Stock Exchange, NYSE Euronext in Paris as well as MOEX and RTS.
The company began cooperating with the Hong Kong University of Science and Technology focusing on joint research and development, sharing of knowledge and experience between professors and students of Russian and Hong Kong universities.



In January, the company resumed the construction of the Boguchansky Aluminium Smelter.

In October 2011, RUSAL refinanced its debt for a total of USD 11.4 billion.


The global aluminium industry was now facing a new challenge, the price of aluminium at the LME fell by 15.7%, driving a large portion of global aluminium production companies to the brink of profitability.

In order to minimise the negative impact of external factors, RUSAL focused on achieving long-term efficiency, managing costs and developing strategic projects.

A long-term programme was adopted that envisioned stage-by-stage replacement of unprofitable primary aluminium production capacity with more modern capacity offering competitive production costs and that called for a total reduction of production capacity of 275,000 tonnes of primary aluminium at the Nadvoitsy, Bogoslovsk, Volkhov and Novokuznetsk aluminium smelters.

At the same time, the construction of the Boguchansky Aluminium Smelter, part of the Boguchansky Energy and Metals Complex (BEMO), continued throughout the year with the first two power generators of the Boguchanskaya HPP being put into operation in October.


Global aluminium prices continued to fall, shedding another 8.6% and going all the way down to USD 1,845 per tonne, pushing even more smelters to the brink of bankruptcy.

In order to boost the stability of its business, RUSAL ceased aluminium production at its least efficient smelters in the western part of Russia, cutting aluminium output by 7.6% on an annualised basis, down to 3,857,000 tonnes.


Having experienced a five-year crisis together with the entire global aluminium industry, RUSAL focused on retrofitting its production, improving its energy efficiency and environmental friendliness. 


The Krasnoyarsk Aluminium Smelter begins switching its existing reduction cells to Green Soderberg technology, distinct for its environmental benefits and energy efficiency. Subsequently, projects to switch cells to Green Soderberg technology will be implemented at RUSAL Bratsk, RUSAL Novokuznetsk and IrkAZ.



RUSAL continues pursuing its strategy to increase the production of value-added aluminium products. Together with the government of the Krasnoyarsk Territory, it launches the Krasnoyarsk Technological Valley project, an innovative industrial area. Together with ELKA-Kabel, it established the, a joint venture to produce cable and conductor products. RUSAL Sayanogorsk launches innovative RA-550 cells. The technology developed in RUSAL ETC has no analogues in the world in terms of its capacity and energy efficiency.


RUSAL includes an aluminium wheel production plant in Krasnoyarsk, SKAD. In the same year, the Company launches a new flagship product onto the market – 'green' aluminium under the ALLOW brand. The carbon footprint of ALLOW aluminium does not exceed 4 tonnes of CO2 equivalent per tonne of metal – this is three times lower than the global average.


Boksit Timana begins developing the Verkhne-Shchugorskoye Deposit in the Republic of Komi, which has commercial reserves of around 65 mln tonnes of ore. The Company starts developing the world's largest deposit Dian-Dian (Guinea), with proven bauxite reserves of 564 mln tonnes. RUSAL and the SMS Group (Germany) sign an agreement for industrial production of equipment for a continuous casting, rolling and extruding line (SLiPP) to produce wire rod. The unique technology developed by RUSAL ETC was previously implemented at the Irkutsk Aluminium Smelter.

In addition, in early 2018 RUSAL reorganised several departments into a separate downstream division that took charge of the company's production facilities involved in the production of foil and packaging as well as aluminium powders and aluminium alloy wheels.

A serious challenge for the company was RUSAL's inclusion on the list of persons and organisations targeted by US sanctions. In the first few months after the US sanctions were announced RUSAL had to cut back shipments of finished goods and entering into new contracts with clients became very difficult. The business community and the governments of the countries where RUSAL has operations repeatedly expressed concern over the situation surrounding RUSAL, as well as the soaring prices of aluminium and alumina that resulted from the inclusion of the company on the sanctions list. April 2018 saw the LME price of aluminium hit a 6-year high, exceeding USD 2,300 per tonne.

December 19, 2018 the US Treasury Department notified the Congress it was fixing to remove sanctions from En+ Group and RUSAL after changes in the corporate structure of the two companies. In January 2019, sanctions were lifted from RUSAL and En+ Group, which is the only such precedent in history.


The first stage of the Boguchansky Aluminium Smelter (BoAZ), a part of BEMO, is put into commercial operation. The designed capacity of the first BoAZ stage is 298 ktpa of aluminium. In Taishet, the Company continues constructing an aluminium smelter and an anode plant, which is scheduled to be launched in 2020.