Chinese company Jiuquan Iron and Steel (Group) Company Ltd (JISCO) and Russian mining company, UC RUSAL yesterday executed the agreement for the transfer of ownership of Alumina Partners of Jamaica (Alpart) which has its bauxite mining and alumina processing plant in Nain, St Elizabeth, to the Chinese enterprise.

Government sources said the investment by JISCO would be US$2 billion over five years, which includes the sale price of US$299 million.

Representing the Government of Jamaica at the signing in Beijing, China, was Minister of Science, Energy and Technology Dr Andrew Wheatley and Minister of Transport and Mining Michael Henry.

Former Minister of Mining Phillip Paulwell also witnessed the official signing, attending the function at the invitation of JISCO.

The reopening of the operation is expected to impact the economic landscape of south St Elizabeth, where workers are expected to regain employment.

Alpart was first established in the early 1960s, starting with a union of three companies (Anaconda, Kaiser Aluminium and Reynolds Metals). Since then, it has undergone several partnership and ownership changes, the last of which took place in 2011, resulting in the company being 100 per cent owned by UC RUSAL Ltd.

In September 2011, UC RUSAL signed a deal to acquire the remaining 35 per cent stake in Alpart, giving it full ownership of the St Elizabeth-based refinery.

However, hampered by the global economic recession and soaring energy costs, the Alpart plant was shut down.

Alpart’s current production capacity is approximately 1.7 million tonnes of alumina annually. It is capable of expansion to more than two million tonnes per annum.

In his comments following the signing ceremony, Chuming Chen, chairman of JISCO, highlighted the role of Paulwell in cementing continuity in the negotiations.

The deal will make JISCO enter the top 10 producers of aluminium in China, RUSAL said in the company’s release issued on its website.

To facilitate the transfer of Alpart ownership, JISCO and RUSAL will also enter into a consulting and technical service agreement that will be effective 18 months from the closing of the deal, RUSAL said.

Vladislav Soloviev, UC RUSAL’s CEO, said in the release: “We are very pleased with the achieved agreement. The deal is of financial interest for us in that it does not affect the vertically integrated production chain of the company. RUSAL’s production facilities both in Russia and abroad fully satisfy the company’s alumina demand while the company-owned bauxite resources ensure our plants’ performance for the next 100 years and more. The deal also strengthens our relationship with our Chinese partners, opening new opportunities for the future co-operation in other areas.”

JISCO was established in 1958 as a large-scale iron and steel base, the first one strategically located in the north-west of China. While iron and steel industry remains the main industry of JISCO, the company develops other business divisions including aluminium, electricity, engineering, technical services and other areas.