Wagerup 3 on hold
Alcoa has announced it has suspended work on the proposed expansion of the Wagerup Refinery (Wagerup 3) until market conditions improve. The decision has been taken due to market softness resulting from the global financial crisis.
Alcoa of Australia Managing Director Alan Cransberg, said the action taken was necessary given the current challenging economic environment.
“Alcoa of Australia is a strong and high performing business but, like many companies, we are facing unprecedented economic challenges that require us to reign in capital expenditure and reconsider the timing of our capital projects.
"Wagerup 3 continues to represent one of Alcoa’s best brown field opportunities globally to deliver value through an expansion. When market conditions improve we will revisit implementation of the project," he said.
Mr Cransberg said that the future of Alcoa's business in Australia remains bright but work also needed to be done to secure energy supply for the expansion and understand the detail of the Australian Government's emissions trading scheme before the project could be revisited.
The Wagerup 3 decision is one of a range of initiatives taken by Alcoa Inc to address the global financial crisis.
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How aluminium is made
Alcoa mines bauxite in the Darling Range of WA. The bauxite ore is processed by mixing it with caustic soda, and pressure heated to extract alumina in the form of fine white powder. Alumina is shipped to aluminium smelters in Victoria and exported around the world. The alumina is smelted at very high temperatures when an electric current is passed through it to produce aluminium.
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