Vietnam to skip aluminium production on high cost
HANOI - The high cost of electricity for the production of aluminium has forced Vietnam to shift its strategy in the next five years to only mining bauxite and processing alumina for export, state media reported on Thursday.
The Tin Tuc newspaper quoted an Industry Ministry 5-year plan to 2010 as saying Vietnam had planned to invest in producing 300,000 tonnes of alumina and 72,300 tonnes of aluminium a year from a bauxite mine in the central highland province of Lam Dong.
"But to develop a viable aluminium industry, all countries must rely on low-cost electricity such as nuclear energy, hydro power or gas-fired power," it said.
While having to buy more electricity from China in recent months to offset a shortage at home, Vietnam plans an extra 60 power plants by 2020 to meet a demand that rises at around 15 percent annually.
"It is projected that between now and 2010 Vietnam will concentrate on mining bauxite ore in several key areas in provinces of Lam Dong and Dak Nong and process alumina for export," the ministry report said.
Bauxite is the raw material used for making alumina, a white powder for producing aluminium.
Vietnam estimates its bauxite ore reserves at up to 8 billion tonnes, the world's third-largest after Guinea and Australia, and mostly unmined.
In July, the government gave the state-run Vietnam National Mineral Corporation approval to invest $487 million to mine 2 million tonnes of bauxite in the Tan Rai complex to produce 600,000 tonnes of alumina per year in Lam Dong province.
Construction was slated for the 2006-2008 period so that Vietnam would have its first alumina plant operational in 2009, the newspaper quoted the Industry Ministry as saying.
It said a joint Vietnam/China bauxite-related project and a similar, wholly owned Australian project were awaiting government appraisal. The report gave no timeframe for the projects.
The joint Vietnam/China project aimed to mine and process one to two million tonnes of alumina per year in Dak Nong province, the northwestern neighbour of Lam Dong, the Industry Ministry said.
Last year, a ministry official told Reuters the $1.35 billion project was prepared by Aluminium Corp of China Ltd and included the cost of building a railway.
The Tin Tuc said the other project by Australia's BHP Billiton envisaged exploration and exploitation of bauxite ore in five mines in Dak Nong.
Last November, the state-run Vietnam News newspaper said the Billiton-run project would have an investment of $1.6 billion.
Reuters - September 08, 2005.
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