Guinea has reached an agreement with Emirates Global Aluminium (EGA) that is expected to prevent a potential arbitration case linked to last year’s seizure of the company’s local unit, three people familiar with the matter told Reuters.
As part of the broader settlement, traders and alternative offtakers have been exploring bauxite supply deals tied to the seized assets. These discussions include structures that would rely on upfront prepayments for future shipments to help settle EGA’s claims, according to traders and government officials.
The deal, which is still being finalized, follows the government’s October takeover of Guinea Alumina Corporation (GAC), EGA’s bauxite subsidiary, amid a dispute over plans to build an alumina refinery.
After the takeover, the government transferred GAC’s assets to state-owned Nimba Mining and also held discussions about potential bauxite supply arrangements for EGA, as previously reported.
A government official confirmed that the agreement is close but noted that several technical details are still unresolved. A mining consultant familiar with the situation added that the deal could still change, as EGA’s priorities may be shifting due to the ongoing conflict in the Middle East.
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EGA declined to comment, while Nimba Mining and Guinea’s mines ministry did not immediately respond to requests for comment. Two traders involved in the discussions said the offtake negotiations remain complex, with firms hesitant to commit funds without full clarity on supply chains and compliance standards. The sources requested anonymity due to the sensitive nature of the talks.
Guinea’s takeover, part of a broader push by African governments to gain more value from their natural resources, has disrupted bauxite supply chains. One trading source said interest has centered on spot cargoes ranging from 400,000 to 500,000 metric tons, with some bids reaching up to 600,000 tons.
Larger volumes of up to 1.6 million tons were also discussed but have not yet been secured. “We need to see the assets and ensure the material is traceable, including assurances on labour standards,” the source said.
Efforts to finalize a long-term offtake agreement have been complicated by the government’s push for upfront payments to compensate EGA, a structure that traders are approaching cautiously.
Under this arrangement, a new offtaker would make a bulk payment upfront, which would then be offset over future bauxite deliveries. The two traders added that Nimba Mining has been in discussions with several major trading houses regarding this structure.
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Image Credit: Reuters
