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business|refinery|refining|resources

Alcoa to mothball Western Australia alumina refinery, up to 1 050 staff at risk

9th January 2024

By: Reuters

  

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US aluminum producer Alcoa said on Tuesday it planned to stop production in 2024 at its loss-making Kwinana Alumina Refinery in Western Australia because of challenging market conditions and the facility's age.

Production at the facility which first started in 1963 will cease in the third quarter of this year, when Alcoa will cut its employees to roughly 250, from around 800 currently. In the third quarter of 2025, the workforce will shrink again to 50.

The plant, jointly owned with Alumina will continue to be "actively managed", according to Alcoa.

Alcoa Executive Vice President Matt Reed said the decision reflected the 60-year-old plant's age, scale and cost to operate as well as current market conditions.

“Today’s curtailment decision comes only after thorough and careful deliberation, and we acknowledge that this action will impact workers, business partners, and the community,” Reed said.”

Western Australia Premier Roger Cook and Federal Resources Minister Madeleine King said the decision was "disappointing".

Cook said the state government would help the roughly 800 employees and 250 contractors affected look for new work or retrain.

“Today will be a difficult day for workers in my local community of Kwinana," Cook said. “My government will step up to provide supports for local workers to retrain, reskill and look for new career opportunities in the local area."

The plant's associated port facilities and Alcoa's Pinjarra and Wagerup refineries in Western Australia are unaffected by the shutdown.

Co-owner Alumina said in a statement it fully supported the decision and the Pinjarra and Wagerup facilities were in the first quartile globally for alumina refining costs and emissions.

Alcoa said the refinery recorded a net loss of roughly $130-million last year. The closure is expected to save $70 million annually starting in the third quarter of 2024.

Edited by Reuters

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