2 June 2003
Accra — Ghana represented by the Volta River Authority (VRA) and Kaiser Aluminium and Chemical Corporation and Volta Aluminium Company (VALCO) have signed a Memorandum of Understanding (MoU) in their further relations.
Below is the full text:
The Government of Ghana and the Volta River Authority (both referred to as Ghana) and Kaiser Aluminium and Chemical Corporation and Volta Aluminium Company (both referred to as VALCO) have met in Accra, Ghana from May 28-30 2003 for purposes of consultations aimed at concluding a mutually acceptable set of arrangements that would provide a framework for a future operational regime between the parties.
The Memorandum of Understanding serves as a set of guidelines for collaboration between the two organizations with respect to the rekindling of relationship between the parties.
It is agreed that GHANA and VALCO shall continue to collaborate in promoting mutually beneficial economic arrangement between the parties. To this end the following principles have been generally agreed to form the framework for power supply to the VALCO Smelter.
Principles of Collaboration
1.1. That the supply to VALCO shall be based on a mixed hydro-thermal structure.
1.2. That Ghana shall take all reasonable steps to ensure the restoration of the Volta Lake to functionally appropriate operational levels.
1.3. That both parties are desirous of restoring VALCO to full operational level within the shortest possible time. To this end, Ghana would work with VALCO to provide firm power to the VALCO smelter at levels and at a competitive price that would also take into accounts such other matters as both parties would mutually agree.
2. Short term Measures
It is agreed that the period between May 2003 - December 2005 shall be considered short term and shall constitute a transition period towards a return to operational normalcy. The following issues have accordingly been discussed as the path forward between the two parties.
2.1. That allocation of energy and the power rate(s) for the period Nov. 1, 2003 to Dec. 31, 2005 would be discussed following additional exchanges of information.
2.2. The parties have agreed to reconvene in Accra, Ghana on June 13-15, 2003 to continue discussions.
2.3. That VALCO would be granted temporary permission, to be reviewed every six months, to undertake a number of activities including anode production, use of the VALCO Berth at the Tema Port for commercial services and provision of Job Shop services to industry.
3. Longer Term
It is agreed that the period commencing January 2006 would be a period of normalcy. Ghana will allocate power to VALCO on a firm basis that would not be related exclusively on the level of the Volta Lake.
4. Bauxite Development in Ghana
VALCO has expressed its willingness to assist in an approach to appropriate US Agencies to support conducting additional feasibility studies regarding bauxite reserve exploration and alumina production in Ghana.
VALCO has expressed its willingness to assist in identifying parties that potentially might be interested in exploring investment opportunities in extracting the bauxite reserves and/or alumina production in Ghana.
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