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Released October 20, 2017 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Alcoa Corporation (NYSE:AA) (Pittsburgh, Pennsylvania) has completed the restart of a 250,000-metric-ton-per-year petroleum coke calciner in Lake Charles, Louisiana, and a 345,000 metric-ton-per-year aluminum smelter in Victoria, Australia, the company said Thursday.
The restart of three idled lines also is underway at Alcoa's Warrick aluminum smelter, near Evansville, Indiana. The company said the three lines should produce 161,000 metric tons of aluminum per year for the mill. The facility produces flat-rolled aluminum for the Food & Beverage industry in North America. For more information, see Industrial Information's project report.
After the partial plant restart in Indiana, Alcoa will have about 886,000 metric tons idled of its total smelting capacity of 3.4 million metric tons. Alcoa's Warrick site includes a 269,000 metric-ton smelter, rolling operations and a power-supply system consisting of a coal mine that fuels four generating units with a combined net capacity of about 750 megawatts (MW).
Aluminum companies are reporting modest profits and restoring some idled facilities. Alcoa reported third-quarter 2017 net earnings of $113 million, compared with $166 million in third-quarter 2016. The company reported revenues of $3 billion, up 4%, with increased aluminum and bauxite shipments and higher aluminum prices. Industrial Info is tracking more than $1.9 billion in active Alcoa projects.
Chief Executive Officer Roy Harvey said in that the company's earnings conference call on Thursday that "Alcoa continues to benefit from favorable commodity markets, and we've raised our projections for profitability in 2017 and global aluminum demand growth for the balance of the year."
Alcoa's capital expenditures total $255 million year-to-date. Third-quarter spending was $96 million.
"We anticipate this spend to continue to accelerate in the fourth quarter," said Chief Financial Officer Bill Oplinger. "Depending on the project pipeline and market conditions, we target spending at $100 million to $200 million per year."
In addition to announcing the plant restarts, Alcoa said it continues to evaluate other curtailed sites, including a 64-year-old aluminum smelter in Wenatchee, Washington. The Wenatchee smelter was first mothballed in 2001, after nearly a half-century of continuous operation, when the industry was hit by low aluminum prices and soaring energy costs. Alcoa restarted the smelter in 2004, only to idle it 11 years later, in 2015, when prices collapsed again. "When you think about where do we see real opportunities to bring additional capacity online, it's Brazil; it's the United States, particularly out in Wenatchee," Harvey said.
He added the company continues to look at its Point Comfort facility in Texas.
"That one was curtailed about a year ago," Harvey said. "That's another place where we have to seriously think of prices of $480 per ton of Smelter Grade Alumina. It is an opportunity that we are analyzing very deeply."
The Point Comfort plant ended production in 2016, following a 40% downturn of alumina prices.
Alcoa also said it expects a $60 million to $70 million boost to annual earnings, starting in the fourth quarter, after reaching an early termination agreement with an electricity provider at its idled Rockdale, Texas, smelter. The contract with Luminant Generation Company LLC (Dallas, Texas) had been set to expire no later than 2038. For more information, see Industrial Info's October 16, 2017, article - Luminant to Close Two More Texas Coal-Fired Power Plants
Among the largest Alcoa projects being tracked by Industrial Info is a modernization project at its aluminum smelter in Deschambault, Québec. The modernization includes a 25-year rebuild of a baking furnace, anode production equipment modifications and a potline system upgrade. For more information, see Industrial Info's project report.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
The restart of three idled lines also is underway at Alcoa's Warrick aluminum smelter, near Evansville, Indiana. The company said the three lines should produce 161,000 metric tons of aluminum per year for the mill. The facility produces flat-rolled aluminum for the Food & Beverage industry in North America. For more information, see Industrial Information's project report.
After the partial plant restart in Indiana, Alcoa will have about 886,000 metric tons idled of its total smelting capacity of 3.4 million metric tons. Alcoa's Warrick site includes a 269,000 metric-ton smelter, rolling operations and a power-supply system consisting of a coal mine that fuels four generating units with a combined net capacity of about 750 megawatts (MW).
Aluminum companies are reporting modest profits and restoring some idled facilities. Alcoa reported third-quarter 2017 net earnings of $113 million, compared with $166 million in third-quarter 2016. The company reported revenues of $3 billion, up 4%, with increased aluminum and bauxite shipments and higher aluminum prices. Industrial Info is tracking more than $1.9 billion in active Alcoa projects.
Chief Executive Officer Roy Harvey said in that the company's earnings conference call on Thursday that "Alcoa continues to benefit from favorable commodity markets, and we've raised our projections for profitability in 2017 and global aluminum demand growth for the balance of the year."
Alcoa's capital expenditures total $255 million year-to-date. Third-quarter spending was $96 million.
"We anticipate this spend to continue to accelerate in the fourth quarter," said Chief Financial Officer Bill Oplinger. "Depending on the project pipeline and market conditions, we target spending at $100 million to $200 million per year."
In addition to announcing the plant restarts, Alcoa said it continues to evaluate other curtailed sites, including a 64-year-old aluminum smelter in Wenatchee, Washington. The Wenatchee smelter was first mothballed in 2001, after nearly a half-century of continuous operation, when the industry was hit by low aluminum prices and soaring energy costs. Alcoa restarted the smelter in 2004, only to idle it 11 years later, in 2015, when prices collapsed again. "When you think about where do we see real opportunities to bring additional capacity online, it's Brazil; it's the United States, particularly out in Wenatchee," Harvey said.
He added the company continues to look at its Point Comfort facility in Texas.
"That one was curtailed about a year ago," Harvey said. "That's another place where we have to seriously think of prices of $480 per ton of Smelter Grade Alumina. It is an opportunity that we are analyzing very deeply."
The Point Comfort plant ended production in 2016, following a 40% downturn of alumina prices.
Alcoa also said it expects a $60 million to $70 million boost to annual earnings, starting in the fourth quarter, after reaching an early termination agreement with an electricity provider at its idled Rockdale, Texas, smelter. The contract with Luminant Generation Company LLC (Dallas, Texas) had been set to expire no later than 2038. For more information, see Industrial Info's October 16, 2017, article - Luminant to Close Two More Texas Coal-Fired Power Plants
Among the largest Alcoa projects being tracked by Industrial Info is a modernization project at its aluminum smelter in Deschambault, Québec. The modernization includes a 25-year rebuild of a baking furnace, anode production equipment modifications and a potline system upgrade. For more information, see Industrial Info's project report.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
