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Brazilian mining and metals company CVRD has signed a joint venture with the Aluminum Corporation of China (Chalco) to study the construction of a 7.2Mt/y alumina plant in Pará state in the north of the country.

The first phase of the greenfield project, known as the ABC Refinery, is estimated to need capex of some US$1bn for an initial capacity of 1.8Mt.

The refinery, expected to start operations in 2007, will be located near CVRD’s alumina subsidiary Alunorte, in Barcarena. Additional expansions will gradually increase capacity to 7.2Mt.

The development of the ABC Refinery will form part of a series of related operations involving mining, transportation, shipping and port development in Brazil.

Cooperation between the Brazilian miner and Chalco, China’s largest aluminium maker, has brought closer the Chinese alumina market to bauxite reserves in Brazil, which can help satisfy the Asian nation’s increasing demand for alumina. It will also serve as a basis to further upgrade cooperation between China and Brazil.

CVRD is interested in expanding its investments in the alumina sector through strategic investments in order to establish long-term joint venture partnerships.

Rio de Janeiro-based CVRD is Latin America’s largest diversified mining company, and the world’s biggest iron ore producer.