Nov 25 2004
Alcoa today announced that its Alcoa World Alumina LLC affiliate, Alcan Inc. and the Government of the Republic of Guinea have signed a protocol for developing jointly a 1.5 million metric ton per year (mtpy) alumina refinery in Guinea, West Africa. This protocol sets out the items and framework for the alumina refinery project that will be negotiated over the next few months as part of the memorandum of understanding (MOU) signed by Alcoa World Alumina and Alcan in May. A detailed feasibility study for the refinery is expected to be completed by mid-2005, with construction to begin shortly thereafter.
Alcoa World Alumina and Chemicals (AWAC) - a global alliance between Alcoa and Alumina Ltd, with Alcoa holding 60 percent -- and Alcan, through subsidiaries, each hold a 45% interest in Halco (Mining) Inc., which in turn is a 51% owner of Compagnie des Bauxites de Guinee (CBG) that currently mines bauxite for export in the Boke region of the country. The Government of the Republic of Guinea holds the remaining 49% of CBG. Alcoa and Alcan intend to secure bauxite supplies to the refinery from CBG, adding values to the enormous reserves that it holds in the Boke region. AWAC, Alcan and other Halco shareholders acquire CBG bauxite for use in their individual businesses.
Following the completion of the feasibility study, alumina production could be expected by 2008. The refinery, which would be operated by Alcoa, would be expected to have an initial 1.5 million mtpy capacity and it would be capable of expansion beyond this level. Alcoa and Alcan would market their respective alumina off-take independently. The refinery would incorporate the latest technology and world-class operating and management systems. Alcoa and Alcan will continue to work closely with the Government of the Republic of Guinea on the roles and participation of CBG and the Government in this new project. Alcoa and Alcan will also continue to have discussions with the International Finance Corporation (IFC) concerning a possible investment in the project.
Given the substantial quantity and the high quality of bauxite reserves, Alcoa and Alcan believe Guinea represents an attractive location for an alumina refinery. In addition, the long-standing involvement of Alcoa and Alcan in CBG places them in a uniquely favorable position to develop such a project.
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