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UPDATE 1-France-based Miner AMR starts bauxite production in Guinea

Kitco News

(Adds interview with AMR chief, details, byline)

By Saliou Samb

CONAKRY, Dec 12 (Reuters) - Paris-based miner AMR began production at its Guinean bauxite mine on Tuesday, aiming to produce between 6 and 10 million tonnes a year of the aluminium ore, the company said.

Alliance Miniere Responsable (AMR) was founded by two French businessmen and major shareholders include former Areva CEO Anne Lauvergeon and French telecoms tycoon Xavier Niel.

A company statement said the mine's output will all be sold to Societe Miniere de Boke (SMB), a Guinean company whose main shareholders are Singapore's privately-owned Winning International Group and China's Shandong Weiqao .

"It's all going to China," CEO and co-founder Romain Girbal told Reuters by telephone. By next year they should be producing about 8 million tonnes, but by the following year they should have exceeded the 10 million target, he said.

Guinea has about a third of the world's bauxite reserves, but annual production has hovered below 20 million tonnes a year for several years, owing largely to political instability.

Guinea has suffered periodic protests and riots in its bauxite-mining areas, like the town of Boke, by locals who complain of pollution and a perceived lack of jobs created by mining companies operating there.

Girbal said the company would operate in a more environmentally friendly way than some other operators.

"Regarding pollution, the main nuisance is dust. SMB and AMR are particularly aware of this and regularly water mining tracks, he said.

"AMR is going to use surface miners, a method that is more respectful of the environment and respectful of the population, starting in March. This will notably cause less dust."

In 2017, SMB expects to export more than 15 million tonnes of bauxite, putting it on a par with number one producer Guinea Bauxite Company (CBG), majority owned by Alcoa , Rio Tinto and Dadco.

Until 2015, CBG and Russia's RUSAL were the only companies that exported bauxite from Guinea.

(Reporting by Saliou Samb; Writing and additional reporting by Tim Cocks in Dakar; Editing by Adrian Croft)

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