Completed Mixed AidData Chinese Aid

CAFIC provides $92,711,400 loan for Phase 1 of the Boffa Port Project

$92.71M USD

Funder	China-Africa Fund for Industrial Cooperation Co., Ltd. (CAFIC)
Recipient Organization	Boffa Port Investment Co., Ltd.
Country	Guinea
Start Date	Jun 08, 2018
End Date	May 30, 2028
Duration	3,644 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`104471`

Grant Description

CAFIC provides $92,711,400 loan for Phase 1 of the Boffa Port Project On October 31, 2016, Aluminum Corporation of China Limited (Chalco) signed cooperation framework agreements with the Guinea Government and Société Guinéenne de Patrimoine Minier (SOGUIPAMI) -- a Guinean state mining company -- for the development of the Boffa mine.

Then, in August 2017, CINF submitted a project feasibility study report to Chalco Hong Kong Limited.

On June 8, 2018, Chalco Hong Kong Investment Company Limited (a wholly-owned subsidiary of Chalco) and Chalco Guinea Company S.A. — a special purpose vehicle and joint venture of Chalco Energy Holdings Co., Ltd. (中國鋁業能源控股有限公司) [85% equity stake] and the Government of Guinea [15% equity stake] — entered into a mining convention with the Government of Guinea, pursuant to which Chalco Hong Kong Investment Company Limited agreed to mobilize $585,726,310 for Phase 1 of the Boffa Project while the Government of Guinea agreed to provide mining licenses and rights to transport mining products for the development and operation of Phase 1 of the Boffa Project.

Then, on July 9, 2018, the President of Guinea signed a decree to grant both Boffa north area and Boffa south area a mining permit, effective from July 2018 to July 2033.

Chalco must pay a royalty of $0.208 per ton to the Government of Guinea based on the volume of bauxite extracted from the Boffa mine.

Then, on August 16, 2018, Boffa Port Investment Co., Ltd. (博法港口投資有限公司) was legally incorporated in Hong Kong as a joint venture between Chalco Hong Kong Investment Company Limited [95% equity stake] and Société Guinéenne de Patrimoine Minier (SOGUIPAMI) [5% equity stake].

Phase 1 had two project subcomponents: a $474,014,900 mining project (involving construction and development of a bauxite mine in the coastal town of Boffa at the mouth of River Pongo) and a $111,711,400 port project (involving the construction of a bauxite transportation wharf in the coastal town of Boffa at the mouth of River Pongo).

Chalco Energy Holdings Co., Ltd. agreed to provide a $142 million equity contribution to partially finance the mining project and a 8-year shareholder loan to cover the remaining cost ($332,014,900) of the mining project.

📋 Loan / Grant Terms

💰 Loan Amountto Chalco Guinea Company S

However, it is known that the shareholder loan was collateralized against the project assets and the Government of Guinea’s 15% equity stake in Chalco Guinea Company S.A.

Chalco Energy Holdings Co., Ltd. agreed to provide a $19 million equity contribution to partially finance the port project and bank loans to cover the remaining cost ($92,711,400) of the port project. The borrowing terms of the bank loans to Boffa Port Investment Co., Ltd. are unknown.

However, it is known that the bank loans were collateralized against the project assets, Chalco Hong Kong Investment Company Limited’s 95% equity stake in Boffa Port Investment Co., Ltd. , and the SOGUIPAMI’s 5% equity stake in Boffa Port Investment Co., Ltd. China Non-ferrous Metals Industry Sixth Metallurgical Construction Co.

Ltd. was the EPC contractor responsible for project implementation.

Phase 1 commenced construction in September 2018 with the mine having an expected annual bauxite output capacity of 12 million tons. Then, on October 28, 2018, a formal groundbreaking ceremony took place. The project began filed mining operations on October 6, 2019. By the end of 2019, the quarry of mine had been put into operation.

The first shipment of bauxite was sent to China in February 2020.

Then, in April 2020, a 23 km belt conveyor was commissioned successfully under load and the supporting port project was successfully completed.

On March 20, 2021, the first 300,000 tons of high-grade bauxite were shipped from Boffa mine to Rizhao Port in Shandong Province. Boffa mine was put into operation on April 30, 2020. By the end of 2021, Chalco had extracted approximately 20.4 million tons of bauxite from the Boffa mine.

📋 Staff Comments

The Chinese project title is 中铝博法项目 or 几内亚博法矿山项目.
SOGUIPAMI is a wholly-owned subsidiary of the Government of Guinea.
Chalco Guinea Company S.A. is a joint stock limited company established under the laws of Guinea.
Some sources refer to the total cost of Phase 1 as $706,000,000 rather than $585,726,310. The $706,000,000 figure includes $120.6874 million for lightering system construction, including port tugboat, pushing tugboat or dragging tugboat, non-self-propel lighter, traffic boat, offshore lightering platform, floating crane, etc. The means by which this additional (lightering system construction) project subcomponent was financed is unknown and merits further investigation.
Pursuant to the June 8, 2018 mining convention, Chalco Hong Kong Investment Company Limited must grant the Guinean Government and/or its wholly-owned companies an option to obtain additional equity interests in Chalco Guinea Company S.A. and grant SOGUIPAMI, a company wholly owned by the Guinean government, an option to obtain additional equity interests in Boffa Port Investment Co., Ltd. If these options are exercised in full, Chalco Energy Holdings Co., Ltd.’s equity interest in Chalco Guinea Company S.A would be reduced from 85% to 65% and Chalco Hong Kong Investment Company Limited’s equity interest in Boffa Port Investment Co., Ltd. would be reduced from 95% to 90%. As of 2024, these options had not yet been exercised.
For the time being, AidData assumes the China-Africa Fund for Industrial Cooperation Co., Ltd. (CAFIC) was the sole lender that supported Phase 1 of the Boffa Port Project (see https://www.dropbox.com/scl/fi/rwsr0njotxohg6itmvy4a/Mining-Brochure_may19.PDF?rlkey=q5ftpm40zrmo77lcz9cl86qhi&dl=0). However, this issue warrants further investigation as multiple loans were secured by Boffa Port Investment Co., Ltd. (博法港口投資有限公司). One of the loans secured by Boffa Port Investment Co., Ltd. (博法港口投資有限公司) was a $53 million, 12-year loan.
The June 8, 2018 mining convention can be accessed in its entirety via https://resourcecontracts.org/contract/ocds-591adf-5699672631/download/word.
The Chinese project title is 幾內亞Boffa鋁土礦項目 or 中铝几内亚Boffa铝土矿矿山项目.
Boffa Bauxite Mine is located 8km north by east of the city of Boffa, Boffa Prefecture, BOKE Region in Guinea, consisting of the Boffa North and Boffa South mines. The mining permit number of Boffa North is Presidential Decree No. D/2018/105/PRG/SGG, and the mining permit number of Boffa South is Presidential Decree No. D/2018/106/PRG/SGG. Boffa North covers an area of 653.55km2, and Boffa South covers an area of 594.61km2. Both mining permits are valid for 15-years (from July 9, 2018 to July 8, 2033), and the period can be extended. The single mined mineral is bauxite.
Siyuan Investment Co.,Ltd. was established in 2019 and given responsibility for the management of two medium-and long-term Chinese state-owned investment funds: China-Africa Fund for Industrial Cooperation Co., Ltd. (CAFIC) and China-LAC Industrial Cooperation Investment Fund (CLAI Fund). CAFIC is jointly funded by China’s foreign exchange reserves and the Export-Import Bank of China, with the aim of supporting projects that could promote China-Africa cooperation, improving the wellbeing of African people and facilitating Chinese and African economic development. Since its establishment, CAFIC has actively invested in projects of different sectors and explored new ways to expand industrial cooperation between China and Africa, giving financial support to a group of exemplary projects in areas such as resources and energy, manufacturing and communications equipment. CLAI Fund is jointly funded by China’s foreign exchange reserves and China Development Bank. CLAI Fund targets the Latin America and the Caribbean region, aiming to support China’s competitive industries to meet the demand of LAC countries and enhance China-LAC capacity and equipment manufacturing cooperation. The fund has invested in projects in areas such as clean energy, infrastructure and mining.

📚 Sources & References

SUPPLEMENTAL CIRCULAR 2017 ANNUAL GENERAL MEETING MAJOR TRANSACTION IN RELATION TO DEVELOPMENT OF BOFFA PROJECT IN COOPERATION WITH THE REPUBLIC OF GUINEA AND GRANT OF OPTION FOR ADDITIONAL EQUITY PARTICIPATION
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
REPUBLIQUE DE GUINEE Convention Minière en date du 8 juin 2018
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
国铝业股份有限公司关于拟投资建设几内亚 Boffa 铝土矿项目暨签署《Boffa 项目矿业协议》的自愿公告
Aluminum Corporation of China: Full text of Aluminum Corporation of China's 2022 annual report
Blowing the horn of 'war epidemic' - remembering the 'retrograde' of Chinalco's overseas business under the new crown pneumonia epidemic
Announcement of Aluminum Corporation of China on the Proposed Guarantee for the Financing of Bofa Port Investment Co.
Ltd.
中国铝业股份有限公司关于拟为博法港口投资有限公司融资提供担保的公告
Aluminum Corporation of China: Announcement on the proposed guarantee for the financing of Bofa Port Investment Co.
Ltd, 2023 INTERIM RESULTS ANNOUNCEMENT
Aluminum Corporation of China Limited 2020 Interim Report
ALUMINUM CORPORATION OF CHINA LIMITED
Chalco Guinea Company S.A
Société Portuaire
Chalco Hong Kong Limited
Annexes convention minière, 2018
SUPPLEMENTAL CIRCULAR 2017 ANNUAL GENERAL MEETING MAJOR TRANSACTION IN RELATION TO DEVELOPMENT OF BOFFA PROJECT IN COOPERATION WITH THE REPUBLIC OF GUINEA AND GRANT OF OPTION FOR ADDITIONAL EQUITY PARTICIPATION
BOFFA PORT INVESTMENT LIMITED
Chalco's 1st bauxite shipment from Guinean mine arrives in China
The Boffa bauxite mine project in Guinea undertaken by Chinalco International Sixth Metallurgical Corporation won the National Excellent Engineering Award
CHALCO to offer financing guarantee for Boffa Bauxite of Guinea
中铝几内亚铝土矿矿山项目完成重载试车
海外監管公告
Submission Data File
The mining megaproject of Boffa
Mayor Brown Global Mining Report
Mayer Brown Global Mining Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.