Guinean bauxite exports to China may reach 40 million tonnes in 2018
----Interview with Ramesh Sodum, Director General and Nishant Thanki, Partner of Axis Mineral Resources S.A.
- Axis Mineral Resources S.A. (AXIS) (a subsidiary of AXIS International Ltd) a company registered in Conakry, Guinea is developing a 2 Million Tonne per annum bauxite mine located in the Koniokhoure region of Guinea.
AXIS has completed all engineering design for the bauxite development and is now in the process of completing construction activities on site.
- Asian Metal: According to China Customs, China imported around 14.9 million tons of bauxite from Guinea during the first seven months of 2017, accounting for 39% of China’s total imports in the period. What’s your opinion on the figure? Do you think the Guinean bauxite supply will continue to rise?
- Ramesh Sodum & Nishant Thanki :
- Guinea bauxite export to China is likely to increase as established and emerging companies are actively working and there may be good availability of bauxite in 2018. The figure may reach 40 million tonnes per year in coming year. The favorable location and availability of good quality bauxite near river Fatala makes Axis Mineral resources very attractive and viable compared to other projects. Recently Chinese government has given $20 billion loan to Guinea for development of bauxite mining.
- Asian Metal: Compared with other kinds of bauxite, what do you think of the advantages and disadvantages of Guinean bauxite?
- Ramesh Sodum & Nishant Thanki :
- The Guinea bauxite is considered one of the best metallurgical grade bauxite thanks to its gibbsitic nature and low reactive silica content. Further unlike Brazil and Sierra Leone, Guinea bauxite does not require wet beneficiation process to improve the quality. The main disadvantages are, however, remote location of many deposits, poor infrastructure and long distance from consuming countries like China and India.
- Asian Metal: When did you start with bauxite development in Guinea and how about the progress? How about the reserves, quality, annual capacity and planned output next year?
- Ramesh Sodum:
- We started bauxite exploration activities in Axis Minerals deposits in 2014 and recently feasibility report was submitted and presentation is made for exploitation license before Ministry of Geology and Mines. Estimated resources are about 273 million tons of gibbsitc bauxite with 45% alumina and 2.6% total silica in the 4 major plateaus in 428 Sq. Km of Axis Minerals Bauxite lease area. The mining of bauxite is planned in early 2018 and in the initial year, about 2 million tonnes of bauxite will be exported per annum with capacity to increase production up to 5 million ton / year.
- Asian Metal: How will Axis compete with other owners in Guinea and what are the advantages? How do you think of the cost in production, railway building and transportation?
- Ramesh Sodum & Nishant Thanki :
- The main bauxite plateau (Koniokhoure) of Axis Minerals is located only 35km from the proposed jetty on River Fatala. The combination of good quality bauxite (about 41-42 % Available alumina and <1.5% Reactive silica) and proximity to large river, not far away from main sea makes this deposit ideal for bauxite mining, value addition and export. There is no requirement of rail line for this project. Most of the Guinea bauxite deposits are located in the remote location far away from the river jetties and ports making them heavily dependent of huge and time consuming infrastructure development to start the production. On the other hand some projects, which are located near the ports, may not have the good quality required for exports. Axis Minerals project is ideal combination of distance and quality to make it more viable than others.
- Asian Metal: Based on Asian Metal Database, Chinese demand for imported bauxite is around 5.5 million tonnes per month now. Do you think the demand will be higher in the next few years?
- Ramesh Sodum & Nishant Thanki :
- As we understand, many Chinese alumina refineries are presently working with poor quality boehmitic and diasporic bauxite and these plants may switch over to gibbsitic ore provided there is consistent good availability and prices of imported bauxite are reasonable. In immediate coming months the demand may go down due to cut in production because of environmental issue concerns in China but the long term demand looks robust and sustainable with new refinery projects planned.
- Asian Metal: Indonesia reopened bauxite export in June this year. Do you think that will affect Guinean bauxite? How do you think of the prices of Guinean bauxite?
- Ramesh Sodum & Nishant Thanki :
- The only advantage of Indonesian bauxite is the favorable location for Chinese alumina refineries, however, the quality of bauxite is not comparable to Guinea. With the increasing costs of caustic soda in the world market, alumina refineries prefer to use low reactive silica bauxite and here the use of Guinea bauxite is preferred. The prices will remain stable because of the quality which may increase in the future as refineries start adapting to better quality Guinean bauxite which has less impact on environment because of lower consumption of caustic soda which also saves the costs and improve profitability .
- Asian Metal: How does Axis solve the financing issue? Do you have joint partners for the project? Do you have interest in finding more investors?
- Ramesh Sodum & Nishant Thanki :
- At present Axis Minerals is working with Thankys Group from India and has explored all the resources to establish the Project firmly, however to make the Project more viable in long term perspective, we are interested to have strategic alliance or JV with Alumina Refinery where both Group can develop better partnership to improve quality production with economical operational costs for regular off take of quality bauxite . We are open to talk to investors or alumina refineries for long-term strategic business relations.
- Asian Metal: Does Axis have other mining businesses? How is the experience in bauxite?
- Ramesh Sodum & Nishant Thanki :
- Our partner Thankys Group, a family business company since 1932 has more than 60 years of experience in bauxite mining and export from India. They are also in the bauxite value addition business and have bauxite value addition plant for refractory and abrasive industries.
- Asian Metal: Do you need to add more information about your bauxite project?
- Nishant Thanki :
- Yes we have feelers from refineries that have shown their interest and we are open to talk to alumina refineries of China for long term regular supply of quality bauxite at reasonable price. We are looking at collaboration in which optimum utilization of core competency and individual expertise brigs the best results to create a win-win situation and trust for all concerned. With strong local tie up in Guinea and progressive vision for socially responsible, environmentally safe & long term sustainable plan of mining which will benefits the locals with enhanced skills, value addition in the Guinea and to deliver consistently high quality bauxite to the stake holder. We will invite these companies to visit Guinea and meet us during Bauxite-Alumina conference of IBAAS to be held during September 21-22 in Conakry.
