Alcoa to Permanently Close Suralco Refinery
Alcoa Corp. recently announced that it intends to permanently close the Suralco alumina refinery and bauxite mines in Suriname.
Alcoa Corp. recently announced that it intends to permanently close the Suralco alumina refinery and bauxite mines in Suriname, fully curtailed since November 2015. Suriname’s government and Alcoa reportedly continue to develop definitive agreements concerning Suralco’s remaining activities in the country, as well as the future of the bauxite industry in Suriname. Pending completion of those agreements, Alcoa will continue to operate the Afobaka hydroelectric facility, which supplied power to the Suralco operations.
“We are working in partnership with the government of the Republic of Suriname to reach the best possible solution that would enable Suriname to maintain its bauxite industry,” said Roy Harvey, CEO. “Dialogue is ongoing and progress is being made. As we enter 2017, we also continue to streamline and strengthen our portfolio to better focus on our businesses and the growth opportunities ahead.”
Alcoa will record results of the permanent closure of the mines and refinery in the fourth quarter of 2016, including:
- $90 million in restructuring-related charges, after-tax and non-controlling interest. Alcoa’s share of total cash costs associated with the closure, inclusive of prior accruals, is estimated to be $151 million over five years, with $24 million to be spent in 2017.
- A $31 million non-cash charge, after-tax and non-controlling interest, to impair Alcoa of Australia Ltd.’s (AofA) interests in a Western Australia gas field. AofA reportedly determined that the completed exploration activities did not support the current carrying value. The combined impact of the charges is estimated to be $0.66 per share.
Alcoa also announced that the December 1, 2016, power outage at the Portland Aluminum smelter in Victoria, Australia, is not expected to have a significant unfavorable impact on fourth quarter results. The smelter is an unincorporated joint venture between AofA, CITIC and Marubeni Aluminium Australia.
For more information, visit www.alcoa.com.