Work to start on Attapeu aluminium processing plants

A bauxite mining company will begin construction of aluminium and alumina processing factories next month in Attapeu province.

Sino-Lao Aluminium Corporation Limited first Vice President Premchai Karnasuta (left), shakes hands with Deputy Minister of Planning and Investment Thongmy Phomvixay.

The Sino-Lao Aluminium Corporation Limited signed a mining agreement for bauxite mines and processing plants with the Ministry of Planning and Investment on Monday.

“The plants represent an investment of about 34 trillion kip (US$4 billion),” said the company's second Vice President, Mr Xaysana Seningvongsa, at the ceremony.

The plant will cover an area of about 3,000 hectares in Sanamxay district.

The project is a joint venture between four companies, with a Chinese company being the majority shareholder. The remainder of the shares are divided between a Thai company, a second Chinese company and Lao Service Incorporation Limited, a Lao-owned company.

The investment cost of 34 trillion kip will include the installation of high voltage transmission lines and a power plant with an installed capacity of 1,320MW to generate power for use by the factories.

It will also include the upgrade of the 116-km Road 18A, which runs from Pathoumphon district in Champassak province close to the mine, to the factories in neighbouring Sanamxay district, in Attapeu province. The road will benefit both the local community and the project.

“The plants will take three years to complete and will have an initial aluminium production capacity of 500,000 tonnes a year,” Mr Xaysana said.

The company plans to enlarge production to 2 million tonnes a year when enough energy can be supplied. “We will need about 5,000MW and investment costs will also quadruple,” he added.

Once the plants are completed in 2011, the company will begin mining bauxite ore immediately.

Bauxite mining will take place on 14,500 hectares in Pakxong district, Champassak province.

Studies for the project were conducted in 2005, including a feasibility study and a socio-environmental impact assessment. “So far we have spent about 91 billion kip (about US$11 million) on this work,” Mr Xaysana said.

The company expects to operate the project for 50 years and may extend the investment agreement with the government.

The end products will be exported mainly to Asean countries and to China . The plants will also supply Lao markets if there is a demand.

“Processing 500,000 tonnes of aluminium will yield a profit of about 203 trillion kip (US$24 billion) over 50 years, of which the Lao government will receive 37.3 percent,” he said.

The company will also give the government 101.4 billion kip (US$12 million) for poverty reduction projects in Champassak and Attapeu provinces. Profits will directly contribute to community development such as infrastructure construction, community economic development and employment.

By Phonsavanh Vongsay
(Latest Update September 24, 2008)