FRENCH ALUMINIUM producer Pechiney says it will go ahead with an aluminium smelter project at Coega in the Eastern Cape in the face of an attempted takeover of Pechiney by Canadian rival Alcan. Pechiney Chairman and CEO Jean-Pierre Rodier told a news conference that his firm had now increased its stake in the smelter to 49 per cent, which is up from an initial stake of between 35 percent and 45 per cent. Pechiney would start raising the financing for the project in September, with production due to start in 2006, with full production in 2007. The capacity of the plant will be 460 000 tons of aluminium billets a year. "We don't want any delay in the Coega project that is linked to Alcan 's bid for Pechiney ," he said. Rodier said the Coega project would go ahead irrespective of the Alcan bid, "because it is a good project that makes business sense". One of the reasons Alcan was attempting to take over Pechiney was to gain access to the French technology. According to Pechiney, its AP50 technology offers the advantages of lower capital expenditure, quicker construction, fewer emissions and higher productivity than other aluminium smelters. This technology could only be installed in new plants. “As far as Pechiney is concerned, we have carefully reviewed the economy of the project and are now in a position to say we have committed to 49 percent of the project, provided we can raise the other 51 percent,” he added. The Industrial Development Corporation of South Africa and state electricity utility Eskom have each expressed interest in taking 25 per cent of the shares in the project. Rodier said the boards of the two companies would take final decisions on their participation “in a few weeks”. The final costs of the investment are being affected by the volatile international exchange rates. A report conducted on behalf of Pechiney put the investment cost of the smelter at about US $2.094-billion. However, Pechiney says it hopes to be able to bring the expenditure down to between $1.6-billion and $1.7-billion. Rodier did not give details of how Pechiney planned to raise the finance.