EGA’s subsidiary Guinea Alumina Corporation secures $750m loan
The loan represents Republic of Guinea’s largest ever financing for a mining project
Abu Dhabi: Emirates Global Aluminium on Tuesday said its wholly-owned subsidiary Guinea Alumina Corporation (GAC) secured $750 million (Dh2.75 billion) loan to fund a bauxite mining project in the Republic of Guinea that is expected to boost the country’s economy as well as the production of bauxite ore, the basic raw-material that is required to produce alumina.
Abu Dhabi-based Emirates Global Aluminium is the world’s largest ‘premium aluminium’ producer and operates aluminium smelters in Abu Dhabi and Dubai. The company is equally owned by Mubadala Investment Company and Investment Corporation of Dubai.
“The partnership we have formed with GAC’s lenders secures the long-term success of our Guinea project and for EGA this project financing is in line with our capital allocation strategy,” said Abdulla Kalban, Managing Director and Chief Executive Officer of EGA and Chairman of GAC, said in a statement.
“We are committed to completing and then operating the GAC project to high standards, contributing to improving sustainability performance in Guinea whilst helping to grow the economy.”
International Finance Corporation ($330 million) African Development Bank ($100 million) and Export Development Canada ($150 million) have come together to finance the project.
The remaining funds have been extended by two European development finance institutions as well as commercial banks. including Societe Generale, ING Bank, Natixis, First Abu Dhabi Bank, Emirates NBD and Mashreq Bank.
Societe Generale acted as Financial Adviser to GAC and ING led due diligence on the project on behalf of the commercial banks.
“We are happy to support this project as it will help Guinea increase its exports and bolster local economic growth, including through the procurement of goods and services from the domestic market and significant improvements to rail and port infrastructure,” said Sérgio Pimenta, IFC’s Vice-President for the Middle-East and Africa.
Production from the GAC project is expected to begin during the second half of 2019 with volumes of 12 million tonnes of bauxite per year once steady operations are achieved. Bauxite ore is the most common raw material used for producing alumina and Guinea is the world’s largest bauxite mineral resource holder.