A senior delegation of Russian aluminum giant, United Company Russian Aluminum (RusAl), led by its director general, Vladislav Solovyov, has arrived in Dushanbe to settle disagreements with the Tajik Aluminum Company (TALCO).

According to the TALCO press center, the delegation arrived in Tajikistan on December 26 and they have already visited TALCO’s enterprises situated in Yovon district, Khatlon province.

The delegation members have also got acquainted with the process of production of aluminum at the aluminum smelter in Tursunzoda.

Recall, the relationship between RusAl and the Tajik aluminum smelter stretches back to the 1990s, interweaving the two enterprises’ commercial interests. 

The dispute began after a 2004 management change at the Tajik aluminum plant.  TALCO still says the previous management stole hundreds of millions of dollars.  The two parties settled out of court, with legal fees reportedly totaling over $100 million.

The relationship was bolstered by a 2004 promise from Russian President Vladimir Putin who pledged $2 billion in investment to Tajikistan, much of it ostensibly to build the Roghun hydroelectric power plant (HPP).  Kremlin-friendly RusAl was tapped to be effectively in charge of construction; in exchange, it was supposed to get a controlling interest in the aluminum plant.

In October 2004, Tajikistan signed an agreement with RusAl, according to which RusAl agreed to complete the Roghun facility and rebuild the Tursunzoda aluminum smelter.  In August 2007, Tajikistan formally revoked a contract with RusAl, accusing it of failing to fulfill the contract.

After RusAl pulled out of Tajikistan in 2007, its subsidiaries Hamer Investing Ltd and Aluminum and Bauxite Company (Albaco) began arbitration in Switzerland, culminating in October 2013 with two wins.  A Swiss tribunal ordered Talco to pay Hamer $275 million related to broken supply contracts dating back 10 years.  Later, a court in the British Virgin Islands held up an older Swiss award for $70 million to Albaco.

TALCO has rejected the foreign court rulings, insisting the cases be heard in a Tajik court.  The company has said it has documentary evidence proving RusAl was using criminal schemes to bankrupt the Tajik plant and thereby eliminate a competitor.  RusAl has dismissed the accusations, pointing out that the Swiss tribunal rejected TALCO’s $400 million counterclaim.

At the beginning of this year, the Tajik government obligated TALCO to conclude an amicable agreement with RusAl’s subsidiaries.  

The Tajik Aluminum Company (TALCO) is one of the ten largest aluminum smelters in the world and provides up to 70% of the country’s foreign currency earnings, consuming more than 30 % of the country’s electrical power.  TALCO is wholly owned by the Tajik government.  Tajikistan does not mine alumina but imports the raw material through tolling arrangements.

Construction of the Tajik aluminum plant (TadAZ) began in 1972, and the first pouring of aluminum took place on March 31, 1975.  On April 3, 2007, TadAZ was officially renamed to TALCO – Tajik Aluminum Company.  The Tajik aluminum smelter had the capacity to produce 517,000 metric tons per year.

RusAl is the world's second largest aluminum company.  It was the largest until overtaken by China Hongqiao Group in 2015.  RusAl accounts for almost 9% of the world's primary aluminum output and 9% of the world’s alumina production.  The Company was formed by the merger of RusAl, SUAL, and the alumina assets of Glencore, completed in March 2007.  The company operates in 19 countries over five continents and employs over 72,000 people across its international operations and offices.  The company is incorporated in Jersey, where it has its financial center, but its headquarters are in Moscow, Russian Federation.