14 MAY 2013Tuoitrenews.vn
Two bauxite plants in Lam Dong at risk of loss
Edited by : AL CIRCLE
2 min read
Based on recently released figures, the two bauxite mining plants in the Central Highlands province of Lam Dong are facing a risk of great losses, an official said.
Dr Nguyen Thanh Son, director of the Hong River Delta Project Management Unit under the Vietnam Coal and Mineral Group, gave the warning in an interview with Tuoi Tre about the sustainability of the plants based on the latest relevant data announced by Vinacomin.
“According to the data, the Tan Rai bauxite plant, which was built in 2008, is unlikely to achieve its expected socio-economic efficiency, while the other, Nhan Co, which was built in 2010, is likely to suffer more loss than Tan Rai,” Son said. He added that for that reason, “the Nhan Co bauxite plant should be closed.”
According to the latest calculations, the total investment in these two projects is about VND30 trillion (US$1.44 billion), but they can generate only 1,500 jobs. Meanwhile, if that amount were invested in growing industrial trees, it would create millions of jobs, Son said.
As of March 2013, the Tan Rai Project was calculated to gain an after-tax profit of VND896 billion ($43.04 million) per year, down by VND310 billion from a 2009 calculation. The period of loss is also extended by two years to five years.
The project’s payable tax was reduced by VND117 billion to VND 422 billion, but the time of capital return is prolonged by 2.5 years.
As for Nhan Co, the plant’s investment capital is adjusted to increase by 31 percent, while the period of loss is prolonged to seven years with a total loss of VND1,700 billion and its time of capital return period is also extended to 12.9 years.
Meanwhile, the tax amount to be paid by the two projects to the state budget is reduced by VND740 billion.
According to Vinacomin’s calculations, the total loss in the first five years of the Tan Rai project is VND1, 019 billion, while the total capital needed to be returned is 15.172 trillion. As such, if the project suffers losses for the first five years, then in the following seven years, it will have to gain an after-tax profit of VND2,313 trillion.
Such a huge profit is unlikely to be attained for such a time in the bauxite mining industry, and Vinacomin has yet to publicize the scientific basis of its calculations.
Dr Nguyen Thanh Son, director of the Hong River Delta Project Management Unit under the Vietnam Coal and Mineral Group, gave the warning in an interview with Tuoi Tre about the sustainability of the plants based on the latest relevant data announced by Vinacomin.
“According to the data, the Tan Rai bauxite plant, which was built in 2008, is unlikely to achieve its expected socio-economic efficiency, while the other, Nhan Co, which was built in 2010, is likely to suffer more loss than Tan Rai,” Son said. He added that for that reason, “the Nhan Co bauxite plant should be closed.”
According to the latest calculations, the total investment in these two projects is about VND30 trillion (US$1.44 billion), but they can generate only 1,500 jobs. Meanwhile, if that amount were invested in growing industrial trees, it would create millions of jobs, Son said.
As of March 2013, the Tan Rai Project was calculated to gain an after-tax profit of VND896 billion ($43.04 million) per year, down by VND310 billion from a 2009 calculation. The period of loss is also extended by two years to five years.
The project’s payable tax was reduced by VND117 billion to VND 422 billion, but the time of capital return is prolonged by 2.5 years.
As for Nhan Co, the plant’s investment capital is adjusted to increase by 31 percent, while the period of loss is prolonged to seven years with a total loss of VND1,700 billion and its time of capital return period is also extended to 12.9 years.
Meanwhile, the tax amount to be paid by the two projects to the state budget is reduced by VND740 billion.
According to Vinacomin’s calculations, the total loss in the first five years of the Tan Rai project is VND1, 019 billion, while the total capital needed to be returned is 15.172 trillion. As such, if the project suffers losses for the first five years, then in the following seven years, it will have to gain an after-tax profit of VND2,313 trillion.
Such a huge profit is unlikely to be attained for such a time in the bauxite mining industry, and Vinacomin has yet to publicize the scientific basis of its calculations.
Previous article
Evaluation of Central Highland bauxite project necessary
Next articleBauxite Resources Limited announces Buy-back
Grow with
AL Circle
