A new report by Wood Mackenzie displays Venezuela’s potential to revive its aluminium operations.
The report, titled “Beyond oil: what would it take to revive Venezuela’s aluminium industry?”, explores future opportunities for the industry after the country’s aluminium output virtually became zero in 2025.
However, according to the report, it would take a $1.6-$2.3 billion investment to restore production capacity, which was at its peak at 600,000 tonnes per year.
The analysis comes post-US policy shifts toward the country.
The Venezuelan aluminium industry’s potential lies in the fact that the industry remains vertically integrated.
“Unlike some frontier jurisdictions, Venezuela is not starting from zero when it comes to aluminium,” stated Uday Patel, principal analyst at Wood Mackenzie.
“It already produces — or at least has produced — at an industrial scale. The country has long mined bauxite and once ran a sizeable aluminium value chain, from alumina refining to metal smelting, powered by hydroelectric plants in the Guayana region.”
Venezuela has world-class bauxite reserves comparable to major global producers.
Since 2019 the country’s major smelters, Alcasa and Venalum, have largely been idle due to a nationwide blackout that year.
According to the report, only Venalum would be worth restarting due to the condition of Alcasa, but this would still require an estimated $1-$1.5 billion to reline cells, rehabilitate power systems, anode production, infrastructure and environmental enhancements for 460 ktpa capacity.
“While reviving Venezuela's aluminium sector presents significant opportunities, it also comes with major challenges,” Mr Patel added.
“In the end, it will come down to a trade-off between political and strategic expediency and economics. However, if conditions are met, it could take only two-to-three years to fully re-establish the aluminium value chain.”
Read the full report here.
