New era for aluminium industry: GIADEC granted 6 mining leases
The country has taken a significant leap to become a formidable player in the global aluminium market by granting six mining leases to the Ghana Integrated Aluminium Development Corporation (GIADEC), the state-owned entity spearheading the ambitious agenda.
The Minister of Lands and Natural Resources, Emmanuel Armah-Kofi Buah, signed off the leases last week, giving GIADEC the power to derive value from the country’s bauxite resources from mining to refinery and smeltering.
Speaking in an interview on the development with the Daily Graphic, the Chief Executive Officer (CEO) of GIADEC, Reindorf Twumasi Ankrah, said “by granting GIADEC these leases, the government empowers the corporation to lead the exploration and commercialisation of Ghana's estimated 920 million tonnes of bauxite, primarily located in Awaso, Nyinahin and Kyebi”.
He said as part of the new strategic direction, GIADEC would now form dynamic partnerships with private sector miners, engineers and financiers to develop the value chain, while keeping the processes predominantly Ghanaian.
“GIADEC's mandate is clear: to develop a fully integrated value chain, from mining and refining bauxite into alumina, to smelting alumina into aluminium, and fostering a thriving downstream industry.
“The ultimate goal is to feed the Volta Aluminium Company (VALCO), Ghana's existing smelter, and to establish a robust export market for bauxite, alumina and finished aluminium products,” he said, adding that “early indicators of investor confidence are overwhelmingly positive.”
Mr Ankrah said GIADEC had already secured a significant Memorandum of Understanding (MOU) with Emirates Global Aluminium (EGA), one of the world's leading aluminium companies.
He said the landmark agreement was set to explore extensive collaboration, including the development of new bauxite mines, the construction of vital railway infrastructure, spanning 125 kilometres, to transport bauxite and other products through the Takoradi port, a critical artery for export, which would also be expanded.
“Infrastructure development is essential for Ghana to unlock the full potential of its bauxite resources and ensure efficient logistics across the western corridor to Nyinahin in the Ashanti Region,” The GIADEC CEO told the Daily Graphic.
He disclosed that GIADEC was also at advanced stages of strategic partnership discussions with Madison Alumina, an American company, to develop a world-class alumina refinery and a new aluminium smelter in Ghana to produce higher-grade aluminium for the demanding shipping, defence and aerospace industries.
Other proposals
Included in the discussions, Mr Ankrah said, was the treatment and further processing of bauxite's red mud (bauxite residue) to transform the by-product into higher-grade cement and caustic soda.
The GIADEC CEO said the corporation’s simulations indicated that the integrated approach would generate over 20,000 direct and indirect jobs, benefiting Ghanaian youth.
Furthermore, Mr Ankrah said Madison Alumina had also proposed to deploy an independent power solution to generate 5,000 megawatts (MW) of power through solar and other green energy options, which aligned with GIADEC's commitment to sustainable industrial development.
The CEO of GIADEC, a legal practitioner with several years of practice in the extractive industry, real estate, medical negligence, corporate and commercial law, dispute resolution, among others, said engagements were also underway with potential investors to partner with VALCO to retrofit, modernise and increase the plant's production from the current 50,000 tonnes to 300,000 tonnes per year.
“This modernisation is crucial for VALCO to transition from a legacy plant to a highly efficient and profitable entity, anchoring Ghana's Integrated Aluminium Industry,” Mr Ankrah pointed out.
Investor appetite
He disclosed that investor appetite for Ghana's integrated aluminium industry had reached unprecedented levels in the last three months, and that GIADEC was actively courting partnerships, proposing three flexible and attractive strategic options for collaboration.
They are the credit resource swap, an approach where investors can provide critical infrastructure or financing in exchange for future bauxite or alumina supply; the long-term off-take arrangements, which offers certainty and stability to investors through guaranteed long-term purchases of bauxite, alumina or aluminium, and the strategic partnerships in joint venture operations, necessary to encourage direct equity participation and shared risk/reward in infrastructure development, mining, refining and smelting operations.
“Our new strategy is not merely a mining venture; it is a vision for comprehensive industrialisation, poised to create thousands of jobs, enhance local value addition, and secure Ghana's position as a key player in the global aluminium market,” Mr Ankrah stressed.
Context
For decades, the country’s vast bauxite reserves have largely been unexplored to support its industrialisation envisioned by Ghana’s first President, Dr Kwame Nkrumah.
The "Reset Agenda" being championed by President John Dramani Mahama is aimed at transforming the paradigm to ensure that the country derived maximum benefit from its natural resources.
