Guinea could produce 10 million tonnes of alumina a year within a decade, more than ten times its current output, as investors flock to the West African nation, an industry executive told Reuters.
Brian Herlihy, vice-president for development at Global Alumina, said the Toronto-listed company expects to produce the first alumina from its own $2.8 billion refinery development in northern Guinea by the first half of 2009.
It could then expand capacity at the Boke plant to 4.5 million tonnes by adding a third train. Construction on the project began in 2005 and work on the refinery site starts this month, although Global has yet to finalise the financing.
"Global Alumina has the aim of building a second and a third refinery and our belief is that all that will be in Guinea," Herlihy said in an interview.
With the world's largest aluminium producers Alcoa also planning a refinery through their Halco joint venture in Guinea, the country's alumina output is set to rise sharply from around 700,000 tonnes per year at present.
Guinea contains almost a third of the world's reserves of bauxite - which is refined into alumina and then smelted into aluminium. Until now it has exported almost all its bauxite production of up to 15 million tonnes due to lack of refineries.
"In the next 10 to 15 years, I believe there will be 10 million tonnes a year of alumina exports from Guinea," Herlihy said, adding this would not reduce bauxite exports.
"Around eight companies are looking at concessions in Guinea at the moment," he said. "Guinea is going to play an important strategic role in the alumina industry."
Global Alumina, created solely for this project, aims to finance it with $1 billion in equity and $1.8 billion in debt.
Global, 25 percent owned by Dubai Aluminium, has already raised $440 million of equity, and is in talks with around five industry investors with the aim of raising the rest of the equity tranche by the end of the summer.
The company is also in advanced negotiations with a consortium of lenders - including export lending agencies from France, China and South Africa - with the aim of wrapping up the debt issue by November.
Anticipating an alumina boom in Guinea, Global is building a massive terminal at Kampsar port with the capacity to export 10 million tonnes a year, which could serve other new refineries.
Global Alumina will supply its Boke refinery with bauxite from its own concessions, although it would contract a mining company to produce the ore, Herlihy said.
The Global Alumina executive played down a nine-day general strike which ended on Friday to protest the economic policies of President Lansana Conte, which have stoked price rises and deepened poverty for the majority of Guineans living on less than $1 a day.
China, which is looking increasingly to Africa for raw materials to fuel its economic boom, has been paying particular attention to Zimbabwe, selling Mugabe's government fighter aircraft and agreeing to a number of business deals.
This month a Chinese company and two Zimbabwean firms signed deals worth $1.3 billion to establish coal mines and three thermal power stations in the country, and Chinese companies are also bidding for rights to explore Zimbabwe's uranium deposits.
Mujuru told the Chinese that Zimbabwe would do its part to benefit from the promised help, and said the country was trying to build its own "socialist market economy", borrowing some concepts from China.
"We leave for home knowing the ball is in our court because our friends are willing to assist us," she said, inviting China to exploit Zimbabwe's vast mineral wealth.
"We have some people perceiving Zimbabwe as a very poor country. Yes we do not have the greenback (the US dollar) or the euro but we have minerals in abundance," Mujuru said.
Analysts say Zimbabwe's platinum, nickel and copper deposits could all be of likely interest to Chinese companies.
Mugabe, 82 and in power since independence from Britain in 1980, has links to Beijing dating back to the 1970s when he co-led a guerrilla war against white minority rule.
Chinese Premier Wen Jiabao is currently on an African tour, but he will not visit Zimbabwe.