Swiss based commodities company Klesch said that the decision was based on an improving business climate and a proposed deal to connect the smelter to the German power grid. The power deal could enable Aldel to purchase cheaper electricity from Germany.

Aldel will initially produce 100,000 tonnes a year of aluminium products, used extensively by the automotive industry, and aims to employ 200 people by the end of 2015.

Klesch Group, founded by Gary Klesch, bought Aldel in 2009 but the smelter applied for bankruptcy in January after failing to negotiate an energy deal.

Low metals prices and oversupply had prompted cuts in production of the metal used in transport and packaging over the past two years. However, the market is expected to tighten significantly to register a 102,500 tonne deficit next year, boosting prices.