CAPE TOWN, Feb 7 - The world's biggest mining group BHP Billiton is close to sealing a deal to build and operate an alumina refinery in Guinea that would cost about $1 billion, a top official said on Wednesday.
Billiton has been in talks with Global Alumina Corp. about the project, which is due to be finalised very soon, Billiton Executive Director Marius Kloppers told reporters in Cape Town.
"We're in very advanced stage discussions there and we're hoping to conclude things within the next couple of weeks," said Kloppers, group president of non-ferrous materials.
"It is a very large alumina refinery, a couple of million tonnes of alumina, and probably something on which we will have to take a 7-8 billion rand ($974 million-$1.11 billion) investment decision over the next 12 months," he said on the sidelines of the Indaba African mining conference.
The website of Global Alumina says other joint venture partners for its refinery project are Dubai Aluminium Company Ltd (DUBAL) and Mubadala Development Company.
"We are basically looking to become the operator, the executor of the project and a substantial shareholder in the project," Kloppers said.
The company was not worried about recent unrest in Guinea that led to a halt to exports and hoped that a big investment could help spur a turnaround.
TURNAROUND?
"It's a country with a difficult last couple of years, but it is also a country where we can make a difference...I think a single big investment like that could could actually change the course for that country as it has done in Mozambique," he said.
Billiton built the Mozal aluminium smelter in Mozambique as the country was recovering from a devastating civil war, but now investment there is booming.
Billiton is also looking for new aluminium smelter projects in places with excess power since smelters require enormous amounts of electricity.
The group is at the "early stages" of looking at such a project in the Democratic Republic of Congo and other possibilities were Malaysia and Chile, he said.
"There are several places in the world where you've got hydro potential or gas potential and you've got no people nearby," he said.
But an electricity crisis in South Africa that led to power cuts last month means that Billiton will have to put on hold hoped-for expansions at its smelters in southern Africa.
"We'd like to expand that business... but possibly at this very moment in time given what (state utility) Eskom's got to do in order to meet other needs... it's not the most opportune moment," said Kloppers.
The group had been hoping to boost production at Mozal and the Hillside smelter in South Africa.
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