The deal, signed yesterday with the Guinea government, will strengthen the UAE’s access to upstream resources needed to make aluminium.
“This agreement will deliver an estimated $5bn of foreign investment into Guinea over the next eight years,” said Mohamed Lamine Fofana, the Guinea minister of mines and geology. “The development plan will create at peak 14,000 direct and indirect jobs and contribute substantially to Guinea’s GDP.”
Mubadala and Dubal signed the deal through Guinea Alumina Corporation (GAC), a joint venture firm owned by the two companies.
Under the agreement, GAC will build a bauxite export mine to be operational by 2017 in Sangaredi, a mining area in the west of the country.
The deal also includes the development of a port by 2017 in Kamsar, a coastal city connected to Sangaredi by railway. The port will be open to other mining and refining projects in the region, as well as local users from other industries.
Finally, GAC will build an alumina refinery with an initial capacity of 2 million tonnes per year. Work on the refinery will begin in 2018, with the first commercial output expected in 2022.
The deal was announced yesterday in Abu Dhabi during the Guinea Development Partners and Investor Conference, a gathering of government officials and business people intended to attract investment to the West African country.
Guinea is reckoned to have some of the world’s richest mineral reserves, including more than 25 billion tonnes of bauxite.
In May, Mubadala and Dubal announced they were jointly taking over the GAC project in Guinea, acquiring a 66.6 per cent stake from BHP Billiton and Global Alumina, two international mining companies. Mubadala, a strategic investment company owned by the Abu Dhabi Government, and Dubal had previously been minority investors in the project, owning 8 per cent and 25 per cent of GAC respectively.
"This new agreement will create considerable benefits for the two parties," said Abdulla Kalban, the chairman of GAC, Dubal's chief executive and the chief executive and managing director-designate of Emirates Global Aluminum (EGA), the company created following the merger this year of Dubal and Emirates Aluminium (Emal).
EGA will be the world’s fifth-largest aluminium company by production on the completion of Emal’s phase two expansion next year.