By David Lewis
DAKAR (Reuters) – Brazilian mining giant Vale plans to invest in $15 billion to 20 billion in projects in Africa over the next five years, up from $2.5 billion spent on projects there so far, the firm said.
The world’s largest iron ore miner said it could become one of the top three copper producers on the continent, where there are high grades of the metal, but it is also targeting significant investments in coal and iron ore.
Vale and a number of other Brazilian firms have expanded their interests in Africa under President Luiz Inacio Lula da Silva, who steps aside this year, having led a diplomatic push onto the continent and urging Brazilian firms to invest there.
The company said it would invest between $15 billion and $20 billion, with most of the money spent in Mozambique, Zambia, Guinea and Liberia.
It said total investment in Africa so far was about $2.5 billion but as most of the projects were in the exploration phase, there was a chance to significantly increase its investment.
Vale said it had a vision to be among the top three players in copper mining in Africa. It said the high-grade copper in the copperbelt means the capital required to have an operation there was not high compared to other regions.
Vale has a $1.3 billion coal project in Mozambique that is due to begin production next year. It also has a stake in the vast Simandou iron ore deposit through a $2.5 billion deal with BSG Resources.
Vale is also eyeing copper opportunities in Democratic Republic of Congo and Angola, while it has an exploration programme for coal in Tanzania.
The company is due to unveil its spending plans for 2011 but a source close to the company said it would invest at least $20 billion next year, up from $12.9 billion of planned spending this year.
The company would not comment on the report.
Earlier this month, Vale said it would need $26-28 billion over the next two years to finish projects it had started.
Source: Reuters Image: Vale