The world’s largest iron-ore producer and exporter, Companhia Vale do Rio Doce, and the Aluminum Corporation of China (Chalco), signed a framework agreement in Beijing, during the visit of the Brazilian President Luiz Inacio Lula da Silva to China, for a joint investment in an alumina refinery in Brazil.

The agreement sets a new cooperation stage for both parties.

CVRD and Chalco, the largest company in China engaged in bauxite, alumina and aluminum production, have agreed to develop a joint study for the construction of a greenfield refinery, the ABC Refinery, in Barcarena, state of Para, Brazil, near the existing facilities of Alunorte – Alumina do Norte do Brasil S/A to produce alumina.

CVRD and Chalco agreed that the ABC Refinery should be established as a first-class alumina refinery, with the highest level of global competitiveness, and its alumina capacity in the initial phase will be 1,8-million tons a year, and is planned to reach a final capacity of 7,2-million tons a year in gradual expansions.

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

The initial phase of the project is preliminarily estimated to have a capital expenditure cost of approximately $1-billion and is expected to come on line in 2007.