UC RUSAL has launched a pilot unit at the Urals aluminium smelter (“UAZ”) to produce primary scandium concentrate using red mud for the production of alloys. The new unit is capable of producing 2.5 tonnes per year of primary scandium oxide concentrate. Throughout 2014, investment in the project has totaled 74 million rubles. The Company expects to create a pilot plant, along with the necessary technology, for the processing of the primary scandium concentrate into a commercial product, where the content of scandium oxide will reach 99.0% by the end of 2014. The market price for such a product ranges from USD3,000 – USD5,000 per kg. The capacity of a pilot plant will be 500kg per year. The scandium oxide produced will be used for the production of aluminium-scandium alloys at RUSAL’s smelters. The use of scandium greatly improves the consumer properties of aluminium alloys. Producing our own raw materials for the production of alloys will allow the Company to reduce costs associated with the purchase of such materials.