June 17, 2016 / 1:48 PM / 2 years ago

CORRECTED-Guinea's CBG gets $1 bln loan to boost bauxite production

(Corrects first paragraph to make clear it is an agreement in principle)

CONAKRY, June 17 (Reuters) - Guinea’s Bauxite Company (CBG) has reached an agreement in principle over a $1 billion loan to increase production capacity at the Kamsar treatment plant, the firm’s general director told Reuters on Friday.

Guinea has around a third of the world’s reserves of bauxite, used to make aluminium, although development has been hampered by years of military rule and popular unrest.

The West African country produces around 19 million tonnes per year.

“We have obtained the agreement in principle of all our financial partners for the loan of $1 billion for the expansion project of the CBG,” Namory Conde said, declining to name the backers.

He said the loan will support a goal to boost bauxite production at the factory from the current annual output of 14.5 million tonnes to 18.5 million tonnes in 2018, an increase of nearly 30 percent.

The ultimate goal is to nearly double output to produce 28.5 million tonnes of bauxite in 2027, Conde said.

Halco Mining consortium, controlled by aluminium producer Alcoa, global miner Rio Tinto and Dadco Investments, has a 51 percent stake in CBG, while the remaining 49 percent is owned by the government. (Reporting by Samb Saliou; Writing by Marine Pennetier; Editing by Keith Weir)

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