Chalco favours true blue plant

CHALCO'S $3 billion Queensland bauxite/alumina project will be a highly Australianised operation if it proceeds, according to company chairman Xiao Yaqing.

"I think in the future most of the key managers will be Australian and my estimate is that 100 per cent of employees will be Australian," Mr Xiao, who is also Chalco's chief executive, told BusinessDaily during an interview at the Beijing headquarters of China's biggest aluminium producer.

The company is also looking at a public tender to select contractors and designers for the proposed bauxite mine and plant, in Aurukun.

"We hope we can use the best designer and the best constructor to build one of the best projects in the world," Mr Xiao said through an interpreter.

"There is also the possibility we might outsource the mining work to local contractors if they can do a better job than us."

But first the company must complete its $40 million feasibility study, scheduled to be finished in time to allow construction at Aurukun to begin by late 2009.

The Queensland Government has previously indicated it could provide up to $300 million to develop infrastructure.

However, the Federal Government has not confirmed its potential financial support.

Mr Xiao said government support was important because it would increase investor confidence in the project.

"Government support is also support for the whole economy because investment will help generate more tax revenue," he said.

Yet to be decided is whether Chalco might share any new port infrastructure and new mining operations at Aurukun with Rio Tinto, now 9 per cent owned by Chinalco in partnership with Alcoa.

Chalco is also open to the idea of new equity partners in its proposed Australian project.

"If someone is interested in acquiring an interest in this project, we are happy to consider the possibility," Mr Xiao said.

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