Rio Tinto's New Zealand Aluminum Smelter Looks to Operate Beyond Planned 2024 Closure

By Stephen Wright

A Rio Tinto aluminum smelter that's the largest consumer of electricity in New Zealand said it is exploring options for operating beyond a planned 2024 closure.

The smelter, which makes aluminum used in mobile phones and airplanes, on Thursday said it is "exploring potential pathways with electricity generators for a future beyond 2024."

Meridian Energy Ltd., which powers the smelter from the Manapouri hydro dam, said it expects talks with the smelter will include contract negotiations. The smelter, located at the bottom of New Zealand's South Island, uses about 13% of the country's electricity supply and accounts for about half a percent of world aluminum production.

Global mining company Rio Tinto had planned to close New Zealand Aluminum Smelter in August 2021, but secured cheaper power prices, which extended its operation to 2024.

The smelter's financial viability has improved following a recent surge in world aluminum prices. Its use of hydro electricity also creates the potential to market its output as less damaging to the environment than other smelters.

Rio has about a 79% stake in the smelter and Japan's Sumitomo Chemical Co. owns 21%.

Write to Stephen Wright at [e-mail]

(END) Dow Jones Newswires

July 27, 2022 17:53 ET (21:53 GMT)

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