Gov’t to barter refined bauxite for infrastructure

Nana Akufo-Addo

President Nana Addo Dankwa Akufo-Addo has said Ghana is seeking to derive more value from its bauxite resources by expanding the country’s processing capacity of the resource.

Speaking at the 61st Independence Day celebration in Accra, President Nana Addo said government will finalise details of an infrastructure programme before end of the year, and will pay for it with refined bauxite.

“It will involve the barter or exchange of refined bauxite for infrastructure such as bridges, roads and hospitals. This will probably be the largest infrastructure programme in the country’s history,” he said.

Last year, government said it signed an agreement with China that may culminate in the development of a US$10billion bauxite venture that will include the construction of alumina refineries and railways.

Ghana, which also mines gold and manganese, produced 827,000 tonnes of bauxite and 40,000 tons of aluminium in 2013, U.S. Geological Survey data show.

Government is currently putting in place the necessary legislation and infrastructure to establish a bauxite refinery in the next two to three years as part of plans to add value to the minerals

A bill seeking to set up a Bauxite Development Authority to facilitate the establishment of an Integrated Aluminium Industry will be submitted to Parliament this year.

This will be after broad consultations with the private sector, which is expected to play a key role as part of government’s quest to create jobs and foster greater inclusion in national development.

Vice-President Dr. Mahamudu Bawumia in a recent speech disclosed: “Our goal is to have an aluminium refinery in Ghana within the next two to three years, possibly by 2019.

“We are going to look at the power and other issues, but there is no reason why we should not be refining our gold or bauxite.

“There is a clear direction that the President has set; we will go with the bill to Parliament early next year, and we will move on with the refinery’s establishment.

“We already have an aluminium smelter and we have the bauxite mine; we just need the middle thing, which is the refinery, and then we will see value addition to our minerals.”

Establishment of an aluminium industry would be further evidence of government’s resolve to partner the private sector to achieve the UN Sustainable Development Goals (SDGs) and make the lives of ordinary Ghanaians better, Dr. Bawumia said.

Bauxite was first discovered in 1914 in Ghana by Sir Albert Kitson. However, it has not been exploited to its fullest potential, with just half of its capacity being mined.

Moreover, there have been major reductions in the amount of bauxite that has been shipped from Ghana.

In 2011, there was a significant drop of 22% as compared to the previous year; and subsequently there has been a decline in the sales figures from exports of bauxite.

In addition, the failure of Ghana Bauxite Company in transporting bauxite to the Takoradi Port, situated 240 kilometres away from the company’s location in Awaso, has proved detrimental for its operations.

The Western Rail Lines of Ghana are in a deplorable condition, which has led to heavy losses for the company over the past few years as it continues to use the more expensive mode of roads to carry ore to the port.

It is estimated that approximately 700 million metric tonnes of bauxite is deposited at Nyirahin, near Kumasi, beside the Prestea Bauxite mines.

Government’s new policy for using bauxite is to stop exporting it raw and ensure that the ore is processed into alumina for use by local aluminum companies.

Due to high energy consumption in the bauxite-aluminum industry, prospective bauxite miners in the country will be expected to provide their own means of electricity for developing the entire value chain.

The Volta Aluminum Company (VALCO) is the largest aluminum company in Ghana, founded by Kaiser in 1961 but now wholly owned by the government of Ghana – with a smelting capacity of 200,000 metric tonnes per year of ingots.

After its shut-down in 2007, the company has since 2011 been producing 3,000 tonnes per month, mostly for local consumption, with plans to activate a second pot-line to bring monthly production up to 6,000 tonnes in the expectation that local bauxite development will accrue to the benefit of such local smelters.

The old bauxite town of Awaso, which still produces the mineral after 66 years, looks dull, underdeveloped and decrepit.

The Bosai Minerals Groups, a Chinese firm, acquired 80 percent shares of the Ghana Bauxite Company with the Ghanaian government controlling the remaining 20 percent stake, and is the sole producer of bauxite ore in the country – which used to produce aluminum for commerce, transportation and other industries’ use.

The Awaso Mine is served by a rail branch line on the Western rail system, while Ghana Manganese Company Limited produces manganese from Nsuta – a small town and the capital of Sekyere Central, a district in the Ashanti Region. Nsuta is served by a station on the country’s national railway network.

However, since 2007 much of the bauxite and manganese ore goes to the Takoradi Port by road due to the railway system’s deplorable state.