The Aluminum reduces the NiCl2 to very finely divided nickel metal, which precipitates in the solution, and acts as a heterogenous hydrogenation catalyst. Excess aluminum is decomposed in the water forming Al3+ and hydrogen, which is adsorbed to the nickel surface and performs the hydrogenation.
If you perform a search on the Hive for "Urushibara" you will find an immense amount of information on possible reductions and the theory behind it. It is a very promising method.