Venezuela’s once-powerful aluminium sector would require between US$1.6 billion and US$2.3 billion in investment to restore operations and help ease the Americas’ aluminium supply deficit, according to new analysis from Wood Mackenzie.
The report, titled Beyond oil: what would it take to revive Venezuela’s aluminium industry and released in January 2026, highlights both the scale of the opportunity and the enormous challenges facing the South American nation as it seeks to rebuild one of its key industrial pillars.
The study notes that Venezuela’s aluminium output has fallen dramatically from a peak capacity of more than 600,000 tonnes per annum to essentially zero in 2025.
That collapse represents a major lost source for the Americas market, at a time when the United States alone recorded a structural aluminium deficit exceeding five million tonnes last year.
The findings come as Washington’s recent policy shifts toward Caracas rekindle interest in Venezuela’s extractive industries, long hampered by economic mismanagement, infrastructure decay, and international sanctions.
“Unlike some frontier jurisdictions, Venezuela is not starting from zero when it comes to aluminium,” said 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.
“Downstream, Sural was once a major producer of EC wire rod exporting significant volumes across North America and Europe.”
Patel emphasised that the nation retains a vertically integrated structure across the aluminium supply chain, from bauxite mining through alumina refining to primary smelting, creating a foundation for recovery if adequate capital and stability return.
Venezuela holds world-class bauxite deposits, with over 300 million tonnes of proved reserves and as much as 5,000 million tonnes inferred, ranking it alongside major global producers.
According to Wood Mackenzie’s estimates, capital reinjection would be required across all levels of production.
Reviving the Los Pijiguaos bauxite mine would demand between US$100 million and US$200 million to restore infrastructure and haulage systems.
The Interalumina refinery would need US$500 million to US$600 million to rehabilitate core processing units and upgrade utilities for a one million tonnes per annum capacity.
Recommissioning the Venalum smelter, identified as the only viable restart candidate among Venezuela’s two main smelting operations, would require US$1 billion to US$1.5 billion to reline cells, restore power systems, and implement environmental improvements.
Both Alcasa and Venalum have been largely idle since a 2019 nationwide blackout crippled production.
“While reviving Venezuela’s aluminium sector presents significant opportunities, it also comes with major challenges,” Patel said.
“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 reestablish the aluminium value chain.”
Key risks include chronic power instability, particularly from the Guri hydroelectric complex, security concerns, and widespread equipment deterioration.
Companies would also require assurances such as investment guarantees and possibly tariff-free access to the US market to offset the high operating risks.
