The IRNA news agency said in a Saturday report that SALCO, located in the city of Lemerd in the southern tip of the Fars province and near the Persian Gulf, will reach 300,000 tons of aluminium output in its first phase of production.
The smelter, one of the largest in the Middle East, creates 1,200 direct jobs and is planned to produce one million tons annually when it reaches full capacity, said the report.
Five Iranian banks have provided finances of more than $1 billion for the first phase of the project where China Non-ferrous Metal Industry's Foreign Engineering and Construction Co. (NFC) has also been contributing.
The project has been funded by the IMIDRO, Iran’s largest holding in mining and metals sector, and Ghadir Investment Company, where Iran’s Social Security Organisation and pension funds related to the armed forces are the main shareholders.
Iran has lagged behind in the production of aluminium compared to other metals. However, vast sources of energy can help the country compensate for the losses suffered over the years as fuel account for more than 25 percent of the cost of aluminium production.
Iran seeks to increase annual output of aluminium to more than 800,000 tons by March 2022 while more than $11 billion will be attracted in investment to bring the figure to 1.5 million tons by 2025.
Production at three major smelters in Iran, namely Iranian Aluminum Company (IRALCO), the Hormozal Aluminum and Almahdi Co. totaled 103,593 tons between late March and late August 2019.