Vale board approves bauxite and alumina projects in Brazil

Tag : bauxite
September 27, 2008 Vale board approves bauxite and alumina projects in Brazil
Companhia Vale do Rio Doce announced that its board of directorshas approved the construction of a new alumina refinery, Companhiade Alumina do Pará and the expansion of our Paragominasbauxite mine Paragominas III, both located at the Brazilian stateof Pará.

CAP will be responsible for the implementation and operation of analumina refinery, located in Barcarena, 5 kilometer away from thealumina refinery of our subsidiary Alunorte. CAP will be 80% ownedby Vale, and 20% by Hydro Aluminum. Hydro, a company based inNorway, is one of the largest global producers of aluminum andaluminum products.

The initial production capacity of the refinery will be 1.86million tonnes per year of alumina, through two lines of 930,000tonnes per year. The new refinery has potential for future capacityexpansions to reach up to 7.4 million tonnes per year.

The estimated total CAPEX for the first phase of CAP is USD 2.2billion. The project implementation will begin in October 2008 andthe operation start up is expected for the first half of 2011.

Paragominas III will supply the bauxite to be consumed by the CAPrefinery. The estimated total capex is USD 487 million and it willincrease the capacity of our Paragominas mine to 14.85 milliontonnes per year from the current 9.9 million tonnes per year.Paragominas III is expected to start up its operationssimultaneously with the first stage of CAP, in 1H 2011.

Vale said that “These projects are consistent with ourstrategy for the aluminum business, in which the focus is organicgrowth in the upstream portion of the aluminum production chain,through the development of its high quality bauxite reserves andcompetitive low cost expansion of alumina productioncapacity.”