Alcoa, Ghana to re-start Valco aluminium smelter in 2006

NEW YORK – Alcoa Inc., the world’s No. 1 aluminum producer, finalised agreements to restart the 200 000 tonne-per-year Valco aluminum smelter in Tema, Ghana, the company said on Thursday.

The restart is expected by first quarter of 2006. In a press release, Alcoa said plans are already underway to restart three potlines at Valco, representing 120 000 tonnes per year.They said they plan to start the facility at a production rate of about 10 000 tonnes per month.The two parties are continuing to discuss previously announced plans to develop an integrated aluminum industry in Ghana that would include bauxite mining, alumina refining, aluminum production, and railroad infrastructure upgrades.Those plans were outlined in a memorandum of understanding signed in January 2005.Alcoa estimated start-up costs at US$20 million (N$130 million), to be funded by debt financing obtained by Valco.According to the restart agreement, Ghana will be the managing owner of the smelter and will receive technical, operational, and commercial support from Alcoa.Alcoa will serve as Valco’s exclusive distributor for export sales of metal produced at the smelter.Alcoa has said in the past that it holds a 10 per cent stake in the venture, although it did not specify exact ownership divisions in Thursday’s announcement.Alcoa said it will participate in Ghana’s bauxite and alumina operations through its Alcoa World Alumina and Chemicals (AWAC) global enterprise, which is 60 per cent owned by Alcoa and 40 per cent owned by Alumina Ltd.of Australia.Alumina, the raw material for producing aluminum, will be supplied through an interim supply agreement between AWAC and Valco.Valco will be powered by Volta River Authority energy supplies.Valco’s chairman Charles Mensah said as recently as July 1 that the aluminum smelter would restart in the first week of July.Alcoa maintained all along that no start date would be set until jointly announced by the company and the Ghanian government.-Nampa-ReutersIn a press release, Alcoa said plans are already underway to restart three potlines at Valco, representing 120 000 tonnes per year.They said they plan to start the facility at a production rate of about 10 000 tonnes per month.The two parties are continuing to discuss previously announced plans to develop an integrated aluminum industry in Ghana that would include bauxite mining, alumina refining, aluminum production, and railroad infrastructure upgrades.Those plans were outlined in a memorandum of understanding signed in January 2005.Alcoa estimated start-up costs at US$20 million (N$130 million), to be funded by debt financing obtained by Valco.According to the restart agreement, Ghana will be the managing owner of the smelter and will receive technical, operational, and commercial support from Alcoa.Alcoa will serve as Valco’s exclusive distributor for export sales of metal produced at the smelter.Alcoa has said in the past that it holds a 10 per cent stake in the venture, although it did not specify exact ownership divisions in Thursday’s announcement.Alcoa said it will participate in Ghana’s bauxite and alumina operations through its Alcoa World Alumina and Chemicals (AWAC) global enterprise, which is 60 per cent owned by Alcoa and 40 per cent owned by Alumina Ltd.of Australia.Alumina, the raw material for producing aluminum, will be supplied through an interim supply agreement between AWAC and Valco.Valco will be powered by Volta River Authority energy supplies.Valco’s chairman Charles Mensah said as recently as July 1 that the aluminum smelter would restart in the first week of July.Alcoa maintained all along that no start date would be set until jointly announced by the company and the Ghanian government.-Nampa-Reuters