Aluminium giant Alcoa cuts production at Portland smelter to 75pc
Aluminium giant Alcoa is cutting operations at its Portland smelter due to a shortage of anodes crucial for production.
Aluminium giant Alcoa Australia has been forced to immediately slash production at its Portland aluminium smelter in southwest Victoria, blaming “operational instability” and a shortage of anodes that are crucial for the smelting process.
The production slowdown was announced on Wednesday by Alcoa as well as its joint venture partner, the publicly listed Alumina.
The lack of anodes triggered a production cut to roughly 75 per cent. It is unclear if there will be any job losses, reduced shifts or lost working hours for smelter workers due to the production constraints.
The lower production to 75 per cent is of the site’s total consolidated capacity of 358,000 metric tonnes per year, of which Alcoa’s share of the total capacity is 197,000 metric tonnes per year.
The smelter, which has a total of 408 pots, had previously been operating at about 95 per cent of its total capacity. The smelter had recently faced instability and challenges related to the production of rodded anodes, which are necessary to convey electricity into the smelting pots. The smelter is currently unable to rod sufficient anodes due to equipment malfunction.
“Our teams are focused on safely taking the production offline and working to restore stability across the facility,” said Rob Bear, vice president of operations – Australia.
“Completing this task in a controlled fashion is our priority as we work to improve operations.”
A company spokeswoman said: “Any potential impacts to the workforce are still being assessed and would be shared with employees as a priority.”
The Portland smelter produces its own anodes for use in the smelting process.
Portland Aluminium is an unincorporated joint venture taking in Alcoa of Australia, which owns 55 per cent, CITIC Nominees, 22.5 per cent and Marubeni Aluminium Australia, which owns 22.5 per cent. Alcoa of Australia is owned by Alcoa Corporation (60 per cent) and the ASX-listed Alumina (40 per cent).
In 2021 the future of the Portland aluminium smelter was secured after a long awaited electricity supply deal was struck with the nation’s biggest energy retailers, saving 500 jobs at the time and bringing an end to looming fears the facility would be axed.
Owner Alcoa reached a deal that kept the manufacturing facility running until at least 2026 with three separate power agreements reached to cover one of the biggest supply contracts in the national electricity market.
Incumbent supplier AGL Energy signed up to a new five-year contract and was joined for the first time by power operators Alinta and Origin Energy.
Portland had been under threat of closure for more than a year before the lifesaving deal was reached, after Alcoa flagged a review of its future if a new, cheaper energy contract could not be negotiated ahead of the expiry of the then current deal.