Guyana poised for dubious Chinese deal

Guyana's president has offered up the country's entire forests as a "carbon offset", were multilateral fundings made available. If the president is serious, this would almost certainly mean that new mining projects - virtually all of which encroach on forest areas and their rivers - will be off the agenda.

However, a Chinese company has already acquired a major mine in the country's bauxite producing region of Linden, and it is now also planning to construct an alumina plant and smelter.

Bosai Mining planning alumina and aluminum capacity expansion in Guyana

Interfax China Metals & Mining

26th September 2008

Chongqing Bosai Mining (Group) Co. Ltd. is currently in talks to build an alumina plant in Guyana, where it has acquired a bauxite mine, and is also looking to set up an electrolytic aluminum smelter and processing plant in the future, a Bosai Mining official told Interfax on Sept. 24.

"Hopefully, Bosai Mining and the government of Guyana will sign a letter of intent for the construction of an alumina plant by early October. The alumina plant will process ore from the acquired bauxite mine, which currently has an annual production capacity of 600,000 tons of bauxite," an official with Bosai Mining's press department, surnamed Zhang, said.

"In order to feed Bosai Mining's planned 1 million-ton alumina smelter, the company will boost bauxite output at the mine," Zhang said.

Bosai Mining, China's largest bauxite processor and exporter, purchased a controlling 70 percent stake in the mine from Toronto-based mining company IAMGOLD Corp. for RMB 190.97 million ($28 million) at the end of 2006, and has also taken on IAMGOLD's RMB 122.78 million ($18 million) debt. The Guyanan government holds the remaining 30 percent stake in the mine.

"Currently, Bosai Mining is carrying out a feasibility study for the project, which is scheduled to be completed in the next two months," another Bosai Mining official, who asked to remain anonymous, told Interfax.

Zhang added that if the alumina project is successful, Bosai Mining plans to build an aluminum smelter and downstream aluminum processing mill in Guyana as well, noting that Bosai Mining's Guyana operation is well positioned to supply the global market.

Bosai Mining is a privately-owned bauxite miner and alumina producer in southwestern China's Chongqing Municipality. It has an annual alumina production capacity of 200,000 tons and is currently building a 300,000-ton aluminum hydroxide plant in Chongqing.

Earlier this year, Bosai Mining's aluminum smelter in Aba prefecture, Sichuan Province, was severely hit by the May 12 earthquake, although operations of the 110,000-ton smelter are expected to resume by the end of the year.

In addition, Zhang told Interfax that the company will boost capacity of the Aba aluminum smelter to 200,000 tons per annum by June 2009, and that it also aims to set up another 500,000-ton aluminum smelter and 400,000-ton aluminum processing plant in Aba prefecture.