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COMPANIES SIGN PROTOCOL FOR ALUMINA REFINERY IN THE REPUBLIC OF GUINEA
Alcan Inc announced today that it has signed a protocol of negotiation with Alcoa World Alumina Llc (Alcoa) and the government of the Republic of Guinea for the development of a 1.5 million tonne per year (mtpy) alumina refinery in the West African nation. This protocol sets out the items and framework for the alumina refinery project, which will be negotiated with the country’s government during the upcoming months as part of the memorandum of understanding between the parties, announced in May 2004. 'Because of the significant quantity and high quality of the bauxite reserves, Guinea represents an attractive location for an alumina refinery and a potential value-maximising growth opportunity for Alcan,' said Michael Hanley, President and Chief Executive Officer of Alcan Bauxite and Alumina. 'In addition, the long-standing involvement of Alcan and Alcoa in Compagnie des Bauxites de Guinée (CBG) places us in a uniquely favourable position to develop such a project,' added Mr Hanley. Alcan and Alcoa (through subsidiaries) each hold a 45% interest in Halco (Mining) Inc that in turn owns 51% of CBG, which currently mines bauxite for export in the Boke region of the country. The government holds the remaining 49% of CBG. Alcan and Alcoa intend to secure bauxite supplies to the refinery from CBG, adding value to the enormous reserves that it holds in the Boke region. Based on the current development plan and timetable, a final investment decision would be made following completion of a detailed feasibility study, within the next 12 months. Alumina production could be expected to begin by 2008. The refinery, which would be operated by Alcoa, would be capable of expansion beyond the initial 1.5 mtpy level. Alcan and Alcoa would market their respective alumina off-take independently. The refinery would incorporate the latest technology and world-class operating and management systems. Alcan and Alcoa will continue to work closely with the government on the roles and participation of CBG and the government in this new project, as well as continue to have discussions with the International Finance Corporation (IFC) concerning possible investment in the project.
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