VZCZCXRO2941
RR RUEHMA RUEHPA
DE RUEHRY #1056 2630715
ZNR UUUUU ZZH
R 200715Z SEP 07
FM AMEMBASSY CONAKRY
TO RUEHC/SECSTATE WASHDC 1657
INFO RUEHZK/ECOWAS COLLECTIVE

UNCLAS CONAKRY 001056 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
E.O. 12598:  N/A 
TAGS: EMIN ECON ETRD PGOV GV
SUBJECT: GLOBAL ALUMINA'S MINING PROJECT VALUED AT $7 BILLION 
 
¶1.  (SBU) SUMMARY.  Contrary to press reports and statements by 
Guinean government officials, econoff's visit to Global Alumina 
revealed that with a $7 billion investment planned, the company's 
proposed bauxite refining project is twice as big as anticipated. 
The project is still in the feasibility study stage, but the project 
manager expects Global Alumina will ultimately approve the proposal 
and move forward on the investment.  END SUMMARY. 
 
¶2.  (SBU) On September 10 and 11, Econoff visited government 
officials and mining projects in the heart of Guinea's bauxite 
country, Boke and Sangaredi (septels)  This area of Guinea is about 
3 hours by vehicle north of Conakry, along some of the best 
maintained and most picturesque roads in Guinea. 
 
--------------------------------------------- -------- 
GLOBAL ALUMINA - STRAIGHT TALK FROM SOMEONE WHO KNOWS 
--------------------------------------------- -------- 
 
¶3.  (SBU) On September 11, Econoff met with Charles Wickwire, the 
Construction Manager for Bechtel and a 32-year Bechtel veteran, at 
the Global Alumina (GA) refinery site just outside of Sangaredi. 
Mr. Wickwire is currently the only AmCit working for Bechtel at this 
site, along with approximately 800 local hires.  Contrary to press 
reports and assertions by government officials, Mr. Wickwire stated 
that Global Alumina will not decide to move forward on the refinery 
project until it reviews the results of the current feasibility 
study, expected to be completed in April 2008.  However, Mr. 
Wickwire said that because GA had already spent $230 million on the 
project, and is keeping 800 people on payroll pending the report, 
his opinion was that the green light will be forthcoming. 
 
¶4.  (SBU) Mr. Wickwire contrasted Bechtel's decision to keep 
Guineans on the payroll with RusAL's unannounced decision to replace 
all Guineans with Russian expatriates except for basic manual 
laborers.  (NOTE: No mention of RusAL's termination of Guineans has 
made the local press.  END NOTE). 
 
¶5.  (SBU) Mr. Wickwire revealed that the current refinery project is 
budgeted at $3.5 billion, but that the company actually plans to 
build a second refinery at the same location, also valued at $3.5 
billion.  (NOTE: This $7 billion figure is also contrary to previous 
media reports of just one $2.5 billion alumina refinery. END NOTE.) 
The project will include not only its own water treatment plant, and 
power generation facilities, but its own air field capable of 
handling jet aircraft to fly in materials and workers, thereby 
avoiding the congestion and costs of going through Conakry. 
 
¶6.  (SBU) When construction gets under way, Mr. Wickwire estimates 
that 9,000 workers will be employed on-site composed mostly of 
expatriates, but with a significant Guinean component.  He also said 
that it is likely that an aluminum smelter will be built as a 
follow-on project, although this would depend on whether the Chinese 
build the hydro-electric dam at Segouri. 
 
¶7.  (SBU) Mr. Wickwire related that the refineries will be located 
in direct proximity to the mines so that the bauxite can be 
efficiently mined, processed and then shipped via a 14 km rail spur 
to the main line to Kamsar for export.  (NOTE: the rail spur is 
currently being built by Chinese company, Henan-China. END NOTE.) 
In addition, the refineries will be able to receive shipments from 
CBG's Sangaredi mines via the same rail spur.  Finally, if Global 
Alumina builds a smelter, the rail line would also handle export of 
the finished aluminum. 
 
------------------------ 
NEW SHERIFF IN TOWN 
------------------------ 
 
¶8.  (SBU) Mr. Wickwire stated that the biggest problem facing the 
project was corruption, pointing out that he had already been 
subject to demands for payments, in-kind and cash, from the local 
prefect and other officials.  However, Mr. Wickwire said that 
Bechtel strictly enforces an anti-corruption policy.  While working 
on a Bechtel project in Equatorial Guinea, Mr. Wickwire said he had 
been thrown in jail three times for refusing to pay bribes to 
government officials, and he does not plan to change his position in 
Guinea. 
 
¶9.  (SBU) COMMENT. Guinea is a beautiful country with vast natural 
resources and enormous potential.  Mining continues to dominate the 
country's economy and new projects on the horizon, such as that of 
Global Alumina's, will continue to contribute significantly to 
national revenues.  However, corruption ultimately undermines the 
country's potential, keeping the vast majority of citizens among the 
poorest in the world.  END COMMENT. 
 
BROKENSHIRE