Purchasing Laos' Mining Company, Chinalco Strives for the Global...

Purchasing Laos' Mining Company, Chinalco Strives for the Global Top 10
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To achieve the goal of ranking among the global top ten mining corporations, Aluminum Corporation of China (Chinalco) is accelerating its pace to invest in overseas mineral resources.

Insiders from Chinalco told China Business News that it would purchase a controlling stake of a mineral resources company under a service enterprise of Laos, which would be its another large-scale investment in the overseas mineral resources after it generously invested in Guinea for a large iron ore project.

The above-mentioned deal was concluded between Chinalco Hong Kong Limited, a wholly-owned subsidiary of Chinalco and the Laotian service enterprise on March 29 when the Chinalco delegation led by Xiong Weiping, General Manager of Chinalco, paid a visit to Laos.

A preliminary investigation from the Ministry of Mineral Resources of Laos indicates that Laos is rich in such mineral resources as copper and aluminum, most of which are untapped. Laos roughly boasts a reserve of 17 million tons of gold ore, 0.8 million tons of lead-zinc ore, and 182 million tons of copper ore which can be used for extracting 2.9 million tons of copper. In addition, Laos also possesses a reserve of 1.6 million tons of tin ore, 125 million tons of bauxites, 14 million tons of iron ore, 128 million tons of gypsum ore, 390 million tons of sylvite ore and 374 million tons of coal ore.

Chinalco refused to disclose how much shares it will hold of the newly acquired company and which mineral resources it would focus on.

Last July 29, Chinalco, along with Rio Tinto, invested USD 1.35 billion in the Simandou iron ore project of Guinea, Africa, the first time for the company to invest in iron ore resources.

Chinalco plans to turn itself into a more internationally competitive conglomerate ranking among the world?s top ten mining corporations in 3-5 years, Xiong said. Besides, Chinalco will participate in resource allocation across the world in an effort to achieve the free worldwide flow of various factors. Its overseas business is planned to account for over 50% of the total in the future and another ?Chinalco? would be established abroad.

Chinalco got rid of being the most money-losing state-owned enterprise last year with a business revenue of RMB 200.3 billion, up 41% year-on-year and an operating profit of RMB 2.7 billion, while the company reported a loss of RMB 7.25 billion in 2009. Meanwhile, Chinalco is shifting its strategic objective from ?Being an international poly-metallic mining corporation? to ?Being a world-class mining corporation with the greatest growth potential?.