Chalco `Pushing Ahead' With Aurukun Bauxite Project, General Manager Says

Aluminum Corp. of China Ltd., the nation’s biggest producer of the metal, is proceeding with plans to develop the A$3 billion ($2.5 billion) Aurukun bauxite deposit in Australia’s Queensland state.

“We are pushing forward with the project in accordance with our agreement with the Queensland government,” Zhao Zhengang, general manager of overseas investment at the company that’s known as Chalco, said today by phone from Beijing. “Chalco and the state government are in close contact and will reach mutual understanding under business principles.”

The Australian Financial Review reported today that Chalco may seek to remove the requirement to build a refinery at the mine to process bauxite into alumina, the raw material for making aluminum, because of increased costs as well as the proposed 40 percent tax on resource profits that Australia announced last month.

Queensland Premier Anna Bligh reiterated the government’s stipulation that the development must include a refinery.

“What we will not do is walk away from the requirement that whoever exploits that bauxite will be required to do secondary processing at another facility,” Bligh said according to a transcript from state parliament. “We will not simply see it put on ships and taken elsewhere for those manufacturing jobs to be gained in other countries,” Bligh said.

Queensland’s Minister for Infrastructure and Planning Stirling Hinchliffe said in an e-mail response to questions that the state remains in talks with Chalco regarding the development agreement for the Aurukun mine and refinery.

The company won the right to develop Aurukun in 2006.

Chalco is due to submit a feasibility study for the project by June 30, after requesting an extension of six months late last year, citing the global financial crisis, according to a statement on the Queensland government website.

--Elisabeth Behrmann in Sydney and Xiao Yu in Shanghai. Editors: Andrew Hobbs, Keith Gosman

To contact the reporters on this story: Elisabeth Behrmann in Sydney at Xiao Yu in Beijing at;

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