Integrated Aluminum Industry
One of the major aims of Ghana’s first President Dr Kwame Nkrumah in the establishment of the Volta River Dam was to provide the country with cheap electricity supply and help in its industrialisation process.
The cheap electricity will be used in processing the huge bauxite deposits in the country into alumina for the local and international markets. This, therefore, saw the establishment of the Volta Aluminum Company (VALCO) to process the alumina.
However, due to the perceived poor quality of Ghana’s bauxite, VALCO imported alumina from Jamaica and processed them into aluminum ingots.
It had been the ambition of Dr Nkrumah to establish an integrated aluminium project, comprising access to bauxite, a smelter and refinery and VALCO came in handy.
However, for more than four decades, a refinery had been out of the production equation of VALCO, making the country operate a fragmented aluminium project, having to export its bauxite and import alumina which is derived from bauxite for the production of foundry ingots and molten aluminium.
Establishing an integrated aluminium project will not only deal with that production fragmentation but also cut down VALCO’s production cost by almost fourfold in respect of the importation of alumina.
This, therefore, gave birth to the Akosombo Dam and the generation of hydro-electric power for the country, which has since been the main pillar for Ghana's industrialisation.
The original project plan was to build the dam, the hydro-electric plant and aluminium smelter and a refinary. However, because it was not possible to raise funds for the entire project, the agreement between Ghana and Kaiser necessitated the latter's building of the smelter.
Since 1965 VALCO has been in operation producing nearly 200,000-tonne per year smelter with six potlines until it was shut down since March 2007, largely due to weak metal prices and power shortages caused by low water levels in the vast Volta hydropower dam.
VALCO before it was shut down was the second largest in Africa, and was the foundation for the local aluminium industry, supplying 10 per cent of its product to local aluminium factories through the Minerals Commission.
Operating at full capacity in those days, the company employed 1,900 people, of which 99 per cent of them were Ghanaians.
Currently, the country fully owns VALCO after buying Kaiser Aluminium's 90 per cent stake in 2004 for US$18 million and then acquiring the outstanding 10 per cent stake from U.S. aluminium maker Alcoa four years later.
The country now plans to establish an integrated industry including a two million tonne/year alumina refinery. The government estimates that as world metal prices recover, VALCO could add about US$300 million in revenues into the economy yearly at full capacity.
In line with a reactivation road map, the management of VALCO is currently holding technical discussions with the Volta River Authority (VRA) to begin operating a second production potline next June.
That will increase its monthly production by 20 per cent from 3,000 tonnes to more than 6,000 tonnes per month (80,000 tonnes annually).
Although that production level is far less than the company’s installed capacity of 200,000 metric tonnes per annum when all the five potlines are activated, it is nevertheless envisaged that the activation of a second potline will create 55, 000 jobs from upstream to downstream.
With respect to VALCO alone, the activation of a second production potline will lead to an increase in staff strength from 480 to 700, apart from the multiplier employment effect it will have on an estimated 445 business downstream.
It must be noted that aluminum due to its low density, low cost, and corrosion resistance, is widely used around the world.
It is used in an extensive range of products from drinks cans to window frames and boats to aircraft. A Boeing 747-400 contains 147,000 pounds (66,150 kg) of high-strength aluminum.
Unlike some metals, aluminum has no aroma - hence its widespread use in food packaging and cooking pots.
Although not quite as good as silver or copper, aluminum is an excellent electrical conductor. It is also considerably cheaper and lighter than these metals, so it is used widely in overhead power cables.
Of all the metals, only iron is used more widely than aluminium and it is 100 per cent recyclable without any loss of its natural qualities.
Recovery of the metal via recycling has become an important facet of the aluminium industry.