CAPE TOWN, Feb 09, 2011 (Dow Jones Commodities News via Comtex) -- Ghana is seeking to develop an integrated bauxite industry in order to draw more value from its natural resources, the country's mining minister said Wednesday.
Alhaji Collins Dauda said that "bauxite would be a way to industrialize the country very fast." He was speaking on the sidelines of the Indaba mining conference here. He noted that Ghana is "losing a lot of money" by selling its resources without seeking to process them in order to generate more value.
Bauxite is a key ingredient used to make alumina which is in turn refined into aluminum.
He said that Vimetco NV (VICO.LN), the U.S.'s Alcoa Inc (AA), and China's Bosai Minerals Group had all expressed interest in participating in Ghana's desired development of an integrated bauxite industry.
He noted that talks have already started with Vimetco. For the moment, Vimetco submitted an application for a bauxite exploration license that the ministry is trying to review "as fast as possible."
Ghana has recently started to produce oil for the first time and expects to generate large amounts of wealth from its discoveries. Cheap access to energy could also play an important role in aluminium production. Around 35% of the costs of aluminum production is related to energy.
Dauda said transportation would also be a key issue. He believes that "not less than $500 million" would have to be invested in new railroads in order to push bauxite integration. At the moment, any plans for an integrated bauxite industry is still conceptual, Dauda said.
"We are still drawing the road map," he added.