Chinese Cosco Shipping Cop. is in talks with shipyards in China to order about 25 massive ships that will move bauxite from the West African country of Guinea for aluminum production in China, people involved in the matter said.
The move is part of a plan by state behemoth Aluminum Corp. of China (Chalco) to invest $700 million in Guinea’s Boffa project for a steady supply of the commodity over the next decade. Cosco is looking to add to its fleet on the back of a long-term contract with Chalco to move aluminum to China.
Guinea is a hotbed of mining activity in recent months as aluminum firms from the U.S., China and Russia, try to carve out a piece of its massive bauxite-ore deposits used to produce alumina and aluminum. About seven billion metric tons, or a quarter of the world’s bauxite resources, are estimated to be in Guinea.
“Cosco is looking for seven ships at the start and the tally will likely be more than 25 vessels,” said one person, who is part of the project. “They will move around six million (metric) tons of bauxite in the first phase, which will more than double as mine production rumps up.”
Shipyard officials in China said Cosco is looking to order capesize vessels, the biggest ships that move commodities such as bauxite and iron ore across the oceans. The order price is expected to be around $1.5 billion.
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