HANOI – Vietnam state mining group Vinacomin has signed a US$300 million government-guaranteed loan with a consortium of foreign banks led by Citi Vietnam to fund the nation's first alumina refinery, the bank said in a statement on Thursday.

The loan is for a 13-year period and has been guaranteed by the Finance Ministry, said Citi Vietnam, a unit of Citibank.

A consortium of foreign banks, including the Mizuho Corporate Bank Ltd, Sumitomo Mitsui Trust Bank Ltd and the Bank of Tokyo-Mitsubishi UFJ Ltd will provide the loan, the statement said.

The Tan Rai alumina plant – located in the Central Highland province of Lam Dong – has faced a series of delays. Production was initially slated to start in the last quarter of 2011, but behind-schedule construction and incomplete administrative procedures slowed the funding process.

The $460-million alumina plant has a full capacity of 630,000 tonnes a year, Vinacomin, its owner, has said.

The loan, which is Vinacomin's largest ever, would enable stable alumina supply for Japan's Marubeni Corp, the statement quoted Yumoto Yohei, head of export and agency finance, Citibank Japan Ltd as saying.

Vinacomin and China's Yunnan Metallurgical Group (YMG) have a 30-year deal for the Vietnamese firm to sell 600,000 to 900,000 tonnes of alumina to Yunnan Metallurgical each year, while state media have also reported that Vinacomin has been in talks with Marubeni about alumina sales.

Vinacomin, also Vietnam's top coal producer, has been developing the Nhan Co alumina project in the neighbouring province of Dak Nong, with projected initial output of 300,000 tonnes in 2014, which could be raised to 650,000 tonnes by 2016.

The Tan Rai plant has been built by China Aluminum International Engineering Co (Chalieco), a subsidiary of state-owned Aluminum Corp of China, or Chinalco, the country's top aluminium producer.

Alumina is a white powder made from bauxite ore that is used to produce aluminium.