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NEWS RELEASE · 9th September 2010
Rio Tinto
Rio Tinto Alcan Primary Metal Group announces discontinuing Billet production at BC Operations, Kitimat Works by the end of 2011

Today, Tuesday, September 8, 2010, Rio Tinto Alcan Primary Metal announced to its Asia Pacific and North American customers that it will officially discontinue billet production at Kitimat’s BC Operations by the end of 2011.

Global billet production will shift to Rio Tinto Alcan primary metal smelters located in Australia and New Zealand, as these smelters are well positioned to serve the billet market in the Asia Pacific region and elsewhere. In fact, these smelters are already supplying billet to the west coast of the North American market.

In light of this global announcement and to ensure for the long term sustainability of Rio Tinto Alcan’s global billet business, BC Operations has begun the process of advising employees about the production changes to take place over the coming year.

Casting and Wharf manager Kirk Grossman says, “The financial return from our billet market has been quite challenging in recent years, and it is no secret that the Asia Pacific forecast for the billet market continues to be cash negative. The time is right, and it makes sense to transfer the production of billet to the Asia Pacific region where our customers can take advantage of market premiums and reduced freight costs.”

BC Operations Director Tino Pereira adds, “It is important to remember that the overall hot metal production at Kitimat Works will not be impacted by this global decision. As a matter of fact,” Tino adds, “We are already increasing the number of pots in operation so that we continue to maximize sheet production at DC4. The balance of our product mix will continue in remelt.”

Vice President of BC Operations and strategic projects Paul Henning stresses, “This shift in product mix will take effect by the end of 2011 and is in line with our goal to maximize production of Sheet products with the balance of hot metal cast in remelt form as per the KMP expected product mix. During the period before the end of 2011 we will return potlines 1C, line 2 and lines 3-5 back to full production which will provide enough employment to avoid layoffs.”