ABU DHABI (Reuters) - Abu Dhabi state-owned investment fund Mubadala MUDEV.UL has signed a $5 billion agreement with Guinea to develop a bauxite mine and alumina refinery in the West African country to secure raw material for United Arab Emirates' aluminium plants.
The agreement includes $1 billion for extraction and exports of bauxite to the UAE as well as a $4 billion aluminium refinery and a port, Mohamed Lamine Fofana, Guinea’s minister for mines and geology told Reuters at a Guinea investors’ conference in Abu Dhabi.
The investment forms part of the UAE’s expansion plans for its Emirates Global Aluminium business, set to become the world’s fifth largest aluminium company by output next year.
Emirates Global Aluminium was created from the merger of DUBAL and Emirates Aluminium (EMAL). The merged group has two aluminium plants in the UAE, one in Dubai and a second at Taweelah near Abu Dhabi.
Under the agreement with Guinea, the bauxite will be ready for export by 2017 and a 2 million tonnes per annum refinery will be operational by 2022, the minister said.
“It is important for Guinea because we have a strong partner in Mubadala,” the minister told Reuters.
Guinea is the world’s top supplier of bauxite, the raw material used in aluminium production. Alumina is partially refined bauxite.
The development also includes a multi-user port in Kamsar in Guinea by 2017. The port will be open to other mining and refining projects in the region, as well as local users from other sectors.
Mubadala had signed an agreement with Compagnie de Bauxites in Guinea in 2012 for the long-term supply of bauxite to the UAE. In May 2013, Mubadala and DUBAL said they would jointly take over a Guinea Alumina Corp project in Guinea, acquiring 66.6 percent from BHP Billiton BHP.AX and Global Alumina.
Previously, Mubadala and DUBAL had been minority investors in the project, owning 8 percent and 25 percent of GAC’s shares respectively. GAC will be a wholly-owned entity of Emirates Global Aluminium.
Reporting by Stanley Carvalho & Regan Doherty,; Editing by William Maclean and Jane Merriman
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