Trafigura signs term sheet for the development of new aluminium smelter in Egypt

Trafigura Pte Ltd. (“Trafigura” or the “Company”), a global leader in the commodities industry, entered into exclusive negotiations with the Egyptian Aluminium Company (“Egyptalum”) and the Metallurgical Industries Holding Company (“MIH”) to develop a new primary aluminium smelter in Egypt, following the signing of a term sheet.

Trafigura, Egyptalum and MIH intend to establish a newly-incorporated company that will construct, own and operate a 300,000 tonne per annum primary aluminium smelter, alongside a 150,000 tonne per annum anode plant, at Egyptalum’s Nag Hammadi complex. The new facilities would nearly double the site’s current annual production capacity.

Trafigura will participate as a minority equity investor in the new company, as well as a debt provider and long-term offtake and feedstock supply counterparty. Total investment costs for the project are estimated at between USD 750 million and USD 900 million.

Over the past decade, the world outside China has drawn down 6 million tonnes of aluminium inventory¹, leaving stocks at historically low levels. Against this backdrop, the new smelter will provide an important additional source of primary aluminium — supporting supply chain diversification and resilience across global markets, while underscoring the strategic importance of downstream processing.

This project builds on Trafigura’s longstanding commercial relationship with Egypt, where the Company has been present for over 20 years and is currently one of the largest suppliers into the country of metals — including alumina, which it has supplied since 2005 — and liquefied natural gas (LNG).

Gonzalo De Olazaval, Head of Metals and Minerals, Trafigura, said: “A significant milestone has been reached with the signing of the term sheet and the start of exclusive negotiations. We are pleased to be working with Egyptalum, a counterparty with proven expertise in the aluminium industry, and to have the support of the Egyptian government through MIH. By building on existing facilities, Egypt has the potential to become a major producer, and we look forward to supporting the country in realising that ambition.”

Eng. Mohamed Al Saadawi, Chairman, Metallurgical Industries Holding Company (MIH), commented: “The signing of this term sheet is a powerful signal that Egypt’s industrial base continues to attract serious, long-term commitment from leading international private sector partners. Trafigura’s decision to co-invest alongside a state-owned entity like Egyptalum demonstrates the confidence that global capital has in Egypt’s economic trajectory and the strength of our industrial platform. MIH is fully committed to supporting the success of this project, which represents one of the most significant industrial investments Egypt has seen in a generation.”

Dr. Mahmoud Abdelaleem Agour, Chief Executive Officer, Egyptian Aluminium Company (Egyptalum), said: “This term sheet marks a defining moment for Egypt Aluminium. By partnering with a global commodity leader of Trafigura’s calibre — as both a strategic investor and long-term offtake partner — we are laying the foundation for Egyptalum to emerge as a leading primary aluminium producer not only in Egypt, but across the wider region. The expansion at Nag Hammadi will nearly double our production capacity, generate significant export revenues, and create lasting value for our shareholders, our workforce, and the communities we serve. We look forward to progressing this partnership towards financial close.”

The signing of this term sheet follows Trafigura’s recent investment in a new smelter under development in Indonesia and underscores the Company’s strategy to secure long-term flows of metal to supply customers around the world.