Alcan Secures Energy and Aluminum Interests in Quebec

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Alcan Aluminum Limited (NYSE:AL) (Montreal, Quebec) is moving forward with long term aluminum projects in Quebec. Understanding that acquiring affordable electrical power is the key to long term aluminum development in Quebec, Alcan recently formed an alliance with Hydro Quebec to optimize hydroelectric resources and solidify long term electrical supply for its planned expansion of the recently opened, "State-of-the-Art" Alma aluminum smelter. The company recently completed construction of the 375,000 ton per annum smelter at a cost of $1.6 billion. At some point in the future, Alcan would like to expand the new Alma primary aluminum smelter by 155,000 tons annually. The $500 million expansion would require an addition 200 mega-watts (MW), which would bring the total electrical usage at the smelter to over 800 MW.

Alcan also recently acquired a 20% interest in Aluminerie Alouette Incorporated, which is planning a $780 million expansion of its primary aluminum smelter located in Sept-Iles, Quebec. Aluminerie Alouette recently won a 500 MW block of Hydro Quebec power to support the expansion.

According to Joseph Govreau, Manager of Metals and Minerals for Industrialinfo.com, "Hydro Quebec currently supplies most of the electrical generation needs for Quebec, mainly from 72 hydroelectric power plants producing in excess of 30,000 MW. Alcan operates 13 primary and downstream secondary aluminum processing plants in Quebec and six hydroelectric stations, which supply power to its aluminum smelters in the region. Alcan is the second largest power producer in Quebec, generating approximately 2,700 MW."

Alcan is also studying the construction of a $31 million aluminum wheel foundry in a joint venture with Amcast. Aluminum would be supplied from Alcan's Saguenay smelter.