UAE industrial giant pins future on net zero 2050 ambitions

Emirates Global Aluminium

• Emirates Global Aluminium aims for zero-carbon production by 2050
• EGA revenue grew 36% to $9.4 billion in 2022
• Customers for EGA’s solar aluminium include BMW and Nissan

Emirates Global Aluminium (EGA) – the UAE’s largest industrial company outside those focused on oil and gas – is pinning its future on the country’s decarbonisation efforts as the global market for aluminium remains under pressure.

The company said it is committed to producing aluminium more sustainably and, last year, produced 57,000 tonnes of CelestiAL branded solar aluminium, up from less than 39,000 tonnes in 2021. 

BMW Group continued to be the largest customer for CelestiAL, but sales agreements have also been signed with Mercedes-Benz and Nissan.

• Oracle Energy looks to the Gulf after Pakistan hydrogen project
• Free Metro rides would boost net zero goal, says World Bank
• $8.5bn funding deals signed for Saudi green hydrogen project

Abdulnasser bin Kalban, CEO of EGA, said: “The immediate outlook for aluminium remains under pressure due to its close correlation to the global economy’s health. More broadly, the prospects for EGA and our sector are strong due to aluminium’s role in decarbonisation economy-wide. EGA will capitalise on this significant opportunity.”

His comments come as EGA reported net profit of $2 billion for 2022, up 34 percent from 2021, while revenue increased 36 percent to $9.4 billion. 

Aluminium is used in products and infrastructure from smartphones to skyscrapers, and has been a bedrock of the UAE’s economy and its industrial ambitions for years. Its exports reach more than 50 countries around the world.

Zouhir Regragui, chief financial officer of EGA, said he expects global demand for aluminium to grow by 1-2 percent in 2023 and “much more over the decades ahead in the transition to a more sustainable economy”. 

“The bulk of new demand will be in secondary and low-carbon primary aluminium, for which there will be a premium,” he added. “We are growing our business in both these areas.”

Joint initiative

Last year EGA, Abu Dhabi National Energy Company, Dubai Holding and Emirates Water and Electricity Company announced a strategic initiative to expand clean energy development, progress power assets, optimise generation and decarbonise EGA’s aluminium production.

The initiative, subject to further negotiation and regulatory approvals in both Abu Dhabi and Dubai, aims to advance EGA as a leader in the global aluminium industry’s drive towards net zero by 2050.

Producing aluminium is energy intensive, and generating electricity accounts for some 60 percent of the global aluminium industry’s greenhouse gas emissions. The use of solar power significantly reduces the emissions associated with aluminium smelting.

EGA was one of the first private sector companies to sign up to the UAE’s Climate-Responsible Companies Pledge, unveiled by the Emirates’ Ministry of Climate Change and the Environment last year. 

The company, which is also a champion of the Make It in the Emirates initiative, said in a statement that it delivered record production at every step of the aluminium value chain from mining to cast metal in 2022.

EGA’s hot metal production recorded 2.65 million tonnes last year and passed 40 million tonnes since the startup of its Jebel Ali smelter in 1979. EGA said it cast the hot metal into a record 2.73 million tonnes of finished products, with premium aluminium making up 78 percent of sales.

Bin Kalban added: “Our performance demonstrated our resilience and strength at every step of the value chain.”

Aim for the stars

Supply of metal to local UAE-based customers was 268,000 tonnes during 2022, down from 281,000 tonnes in 2021, but EGA is also looking to enter the ultimate export market – outer space.

The company is in talks with the Mohammed bin Rashid Space Centre (MBRSC) to explore potential collaboration in research and the use of its UAE-made aluminium in space.

Analysts say the production of aluminium and semi-finished aluminium products supports more than 60,000 jobs in the UAE, once supply chain linkages and employee spending impacts are taken into account, adding that for every job in the aluminium sector itself a further five roles are supported elsewhere in the national economy.

EGA, which began production as Dubai Aluminium (DUBAL) in 1979, is now one of the largest aluminium companies in the world and operates aluminium smelters in Abu Dhabi and Dubai, an alumina (aluminium oxide) refinery in Abu Dhabi and a bauxite mine and associated export facilities in the Republic of Guinea.

Four percent of the world’s aluminium production, and almost half of the aluminium produced in the GCC, is made by EGA. That means approximately one in every 25 tonnes of aluminium is UAE-made.