PITTSBURGH:
ALCOA YESTERDAY announced that its Alcoa World Alumina and Chemicals (AWAC) affiliate and the Government of Jamaica have signed an agreement in principle to expand the Jamalco alumina refinery in Clarendon, Jamaica, by more than 1.5 million metric tonnes per year (mtpy). The expansion will more than double the refinery's total capacity to at least 2.8 million mtpy, the company stated.
In addition, AWAC ownership in the refinery will move from 50 per cent to 70 per cent. The Government of Jamaica will continue to own the remaining 30 per cent. AWAC will pay approximately 85 per cent of the total proposed US$800 million for the expansion and movement to 70 per cent ownership.
The expansion initiative stems from a 2002 agreement with the Jamaican Government to remove a nearly 30-year-old levy on bauxite in order to encourage investment. At the time of the initial expansion (completed in 2003), the removal of the levy along with the expansion lowered costs at Jamalco by approximately 30 per cent. This new expansion will place Jamalco among the world's lowest-cost refineries. AWAC is a global alliance between Alcoa and Alumina Ltd., with Alcoa holding 60 per cent. A final decision to move forward on the project is expected to be made in the first half of 2005. Upon approval, it is expected that the expansion project will be completed by the end of 2007.
