Investor exodus likely to jeopardize Guinea's mining ambitions

Mining News  |  2013-05-27 07:12:50   |   By

The West African Republic of Guinea is said to have abundantly rich bauxite reserves, but the lack of interest by global majors to invest in the country has cast a shadow over the ambitious production raising initiatives by the country

CONAKRY (Scrap Monster) : The West African Republic of Guinea is said to have abundantly rich bauxite reserves, but the lack of interest by global majors to invest in the country has cast a shadow over the ambitious production raising initiatives by the country.

The country’s economy is largely dependent on mineral production. As per statistics released, Guinea stands sixth in the list of world’s largest producers of bauxite. The Government of Guinea had earlier during the year announced its plans to triple the bauxite production of the country in the next 4 years. Guinea had set target to raise its bauxite production from 18 million metric tonnes in 2012 to 60 million metric tonnes by 2017.

The mining industry worldwide is seen facing huge challenges. Many mining majors are seen selling off their assets and reluctant to make fresh investment. The cooling commodity prices, escalating mining costs and slackening global demand have forced many companies to curtail production. Apart from all the above mentioned factors, the Guinea’s mining sector has its own problems including the political unrest prevailing in the country.

Recently, BHP Billiton and the parent company Global Alumina sold their stake in the Guinea Alumina Corp (GAC) to its Middle East partners-Dubal and Mubadala. Rio Tinto has already cut down investments in Simandou iron ore project- once developed, would have been the largest integrated iron ore mine and infrastructure project in the entire Africa. Also Rusal is reported to have decided to withdraw from the Dian Dian aluminum refinery project.