UPDATE 1-RUSAL eyes Siberia smelter with Chinese partner

* Agrees to work closely with Russia economy ministry

* Estimates annual smelter capacity at 800,000 tonnes

(Adds detail, quotes, background)

MOSCOW, Oct 12 (Reuters) - Russian aluminium group RUSAL

is looking for Chinese partners to build a smelter inSiberia with a design capacity of 800,000 tonnes per year.

"We understand that despite the challenging economicsituation globally, now is the time to lay the foundation fordevelopment of Siberia and the far east, as these regions willbe driving Russia's growth in the years ahead," first deputychief executive Vladislav Soloviev said on Friday.

His comment was made after RUSAL signed an agreement withthe economy ministry to "work closely within the framework of apotential joint venture with the Chinese partners to build analuminium smelter in Siberia".

Hong Kong-listed RUSAL had said in September companies inChina, the world's largest consumer and producer of aluminium,should consider investing in new smelting projects in Siberia.

China, which accounts for 44 percent of global aluminiumconsumption, needs to invest in production projects to meetincreasing demand over the next 5-10 years, according to RUSAL.

"We have constantly confirmed that China is a prioritymarket for RUSAL's development. The signing of the agreementwith the Russian Ministry of Economic Development aims toreinforce our joint efforts to increase the presence of Russiain the region," Soloviev said.

Three-month aluminium was down 0.6 percent to $2,003per tonne by 1425 GMT.

(Reporting by Polina Devitt and Andrey Kuzmin; Editing by DanLalor)

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Keywords: RUSAL CHINA/