PERTH (miningweekly.com) – Aluminium major Alcoa on Tuesday announced that it would be closing down its Point Henry smelter and two rolling mills in Australia, which jointly employ nearly 1 000 people.

Alcoa said that its decision to permanently close the Point Henry smelter, in Victoria, came after a strategic review of the operation was taken in February last year, on the back of challenging market conditions.

The review found that the 50-year-old smelter had no prospect of becoming financially viable.

The two rolling mills, one of which is located in New South Wales, serve the domestic and Asian can sheet markets, which have also been impacted by excess capacity.

Despite the company’s efforts, the three assets are no longer competitive, Alcoa said, adding that they were not financially sustainable.

“We recognise how deeply this decision impacts employees at the affected facilities and are committed to supporting them through this transition,” said Alcoa chairperson and CEO Klaus Kleinfeld.

The closure would reduce Alcoa’s global smelting capacity by some 190 000 t, and would reduce the company’s can sheet capacity by 200 000 t.

Including the closure of the Point Henry smelter, the aluminium major has announced the closure or curtailment of some 551 000 t of smelting capacity, which exceeded the 460 000 t placed under review in May last year.

Once the Point Henry closure is complete, Alcoa would have a total smelting operating capacity of some 3.76-million tonnes, with around 655 000 t, or 17%, of high-cost capacity.

The miner noted that the Portland aluminium smelter, in Victoria, would continue with normal operations, as would the company’s bauxite mining and alumina refining operations in Western Australia.

Furthermore, the Anglesea coal mine and power station, which currently supplied some 40% of the power needs for the Point Henry smelter, had the potential to operate as a standalone facility after the smelter closed, and Alcoa was seeking a buyer for this facility.