Alufer Mining's US$205 million Bel Air bauxite (an aluminium ore) mine in Guinea has raised funding from Africa Finance Corp, along with Orion Mine Finance and Resource Capital Funds.

The capital will be used to fund the development of Guinea's bauxite mines. Alufer currently holds a mining licence in the Bel Air Project in Western Guinea, as well as licenses linked to the Labé Project in the central part of the country. Bel Air was designated a project of national interest in December 2014.

The company has declared there to be more than 3 billion tonnes of minerals at both projects, and expects to produce 5.5 metric tonnes of bauxite from Bel Air per year within the next two years.

“As global demand for aluminium increases, AFC is proud to be the sole private sector African investor in the Bel Air Mine, developing a world class mine that adheres to best practice environmental principles,” said AFC’s chief investment officer Andrew Dewar.

Bauxite is the main commercial mineral from which aluminium oxide is extracted, which is in turn smelted to form aluminium metal. A company presentation says that demand continues to grow in key sectors including transportation, construction, power, packaging and consumer products.

The presentation says that aluminium demand in China is still in its early stages, with saturation not expected to match current levels for steel or copper for thirty years. To avoid reliance on imported alumina, China has been developing its own domestic alumina refining capacity, and this has led to a big increase in bauxite imports.

According to Alufer, China is buying lower quality material from India and Malaysia at high prices, and given the quality of Guinean bauxite there is an opportunity for Bel Air to enter the market as a premium supplier.

The mines are located quite near to the coast, and the bauxite will be taken by truck to the port areas. It will then be loaded onto barges for transfer to capesize ocean going vessels.

Photo courtesy of Alufer Mining.