Nhan Co bauxite plant in the Central Highlands province of Dak Nong (Photo: nld.com.vn)

State-run Vietnam National Coal and Mineral Industries Group (Vinacomin) last week worked with leaders of Dak Nong on a new plan worth around VND120 billion ($5.2 million) for a bauxite mining project in the province to last until 2035.

The group will need a large area of ​​land in Dak Nong, especially between now and 2025, for which the demand for available land is estimated to be nearly 28,000 hectares. However, this plan would also soon need the support of local authorities to be implemented, as Le Minh Chuan, chairman of Vinacomin’s Board of Members said.

“Vinacomin and Dak Nong need to reorganise the six allocated bauxite mines, calculate the number of deployed projects, and report to the Ministry of Industry and Trade,” Chuan said.

He also asked Dak Nong to advance funds for the resettlement and implementation of projects, along with the coordination of building phases necessary to exploit the minerals in the area in the next 10 years.

Localities in the Central Highlands are looking to channel their mineral wealth into economic development through investment projects in bauxite, bringing higher value to the region.

This shift seems to be driven by the completion of the exploration and approval of the reserves of 12 bauxite mines in the two provinces of Dak Nong and Lam Dong, where the total reserves amount to an estimated 3.2 billion tonnes of primary ores.

Besides Vinacomin, there were at least four other multi-sector economic groups active in the two provinces – Hoa Phat, Viet Phuong, Sovico, and Duc Giang Chemicals – all of which proposed to invest in bauxite projects, with a total planned processing capacity of over 10 million tonnes per year. However, most of these plans are still in the early stages, according to Dak Nong People’s Committee.

As Vinacomin is a state-owned mining group, it will not have to compete for the best bauxite mining location or a processing plant that is conveniently located for further transport. However, in the short term, Vinacomin cannot expand investments in bauxite projects in the Central Highlands, as there is not enough legal basis for approving such planning and exploitation.

Prof. Dr. Dang Trung Thuan, chairman of the Vietnam Association of Geochemistry, said, “Investment in mining and processing bauxite ore, unlike normal economic projects, involves many socioeconomic factors, such as environmental protection, which remains a huge challenge in Vietnam.”

The land for new and expanded bauxite projects as originally planned is huge. “The two bauxite complexes Tan Rai and Nhan Co are occupying a very large area of ​​land, with a total mining capacity of about 8.8 million tonnes of ore per year. Meanwhile the work of environmental restoration will be very expensive, thereby also adding to the cost of the end products,” Thuan said.

Developing a bauxite and aluminium industrial zone (IZ) in the Central Highlands could be something that attracts many investors to Dak Nong, Thuan suggested, pointing out that the province would be “the most suitable location for such a project.”

Dak Nong has many bauxite mines with large reserves and high quality, and the hilly terrain and its plateaus are favourable for open-pit mining. Based on that, priority objects selected for such an IZ are Dak Song, Bac Gia Nghia, and Nhan Co mines.

“The development of medium-scale bauxite and aluminium complexes is suitable for Vietnamese conditions,” Thuan said.

These projects have a capacity of exploiting around 3-4.6 million tonnes of bauxite ore per year, together with around 1.3-2 million tonnes of aluminium per year to meet the domestic demand as well as save foreign currency.

Thuan recommended paying attention to the power supply for the bauxite-aluminium complexes. “The production of alumina, especially the electrolysis of aluminium, requires a lot of electricity. The most feasible power supply for the bauxite-aluminium complexes comes from Don Sahong, Laos’ hydropower plant, which is based on the Vietnam-Laos Intergovernmental Agreement from 2016,” Thuan added.

The power transmission also seems convenient as the distance from Don Sahong Hydropower Plant to Dak Nong IZ is only about 245km.

The development of the bauxite-aluminium industry in the Central Highlands would not be sustainable without the railways to transport products from the Central Highlands to seaports and other complexes.

“The construction of a 125km railway line from Di An station in the southern province of Binh Duong to Gia Nghia town in Dak Nong is necessary to boost the socioeconomic development in the Central Highlands region,” Thuan said.