Rio Says Cameroon Projects, Hydropower Dam on Track
YAOUNDE, Cameroon, February 13, 2009 - Reuters - Rio Tinto (RIO.L) projects in Cameroon remain on track and the company still aims to build a 1,000 megawatt hydroelectric dam to power a planned aluminium smelter there despite cutbacks elsewhere, it said.
The dam is to be built on the Sanaga River, some 165 km (103 miles) east of Cameroon's economic capital, Douala. It would power a smelter at Kribi, to the south, that would have an initial capacity of 400,000 tonnes of aluminium per year.
Cameroon's current aluminium smelting capacity stands at 90,000 tonnes per year but the country hopes to harness its vast hydroelectic potential to increase this. The Kribi smelter has an eventual potential of 1 million tonnes per year.
"For now our Cameroon programme remains intact and there is no cause for concern," Gerard Baluais, technical director for Rio Tinto Alcan in the Central African country, told state radio late on Thursday.
"That is why we are pursuing research into the construction of a 1,000 MW hydro electricity dam to feed a new aluminium factory to be established at Kribi," he added.
"This dam is at the centre of Rio Tinto Alcan group projects in Cameroon," Baluais said.
In December, Rio Tinto said it would slow the pace of production at its La Granja copper project in Peru. The company aslo said earlier this year that it had all but halted its expansion of the Kitimat aluminium smelter in British Columbia.
After further cuts, Rio Tinto announced on Jan. 20 that it would shed 1,100 jobs, cut a further six percent of aluminium output and scale back alumina production.
Rio and Cameroon's government each own 46.7 percent of Alucam, their joint venture. The remaining 6.6 percent is controlled by other shareholders.
A statement issued by Alucam said the geo-technical studies had been completed but an environmental assessment remained. A final decision on whether the project will go ahead will be taken by the end of the year, it said.
Already the world's fifth largest cocoa producer, Cameroon is targeting mining investments in the region of $10 billion over the next few years. The central African nation pumped 30 million barrels of oil last year but reserves are tailing off.
Cameroon has had to cut its 2009 growth forecast to 4 percent, down from 6-6.5 percent, largely due to the financial crisis and plummeting prices for its oil and metals exports.
(Writing by David Lewis; editing by Alistair Thomson and Anthony Barker)