Alcoa 2012 Annual Report Download - page 26

5In December 2008, approximately 15,000 mtpy annualized production was idled at the Portland facility due to overall
market conditions. In July 2009, an additional 15,000 mtpy annualized production was idled, again, due to overall
market conditions. This production remains idled.
6Owned through Rio Tinto Alcan Inc.’s interest in Pechiney Reynolds Québec, Inc., which is owned by Rio Tinto Alcan
Inc. and Alcoa.
7In May 2010, Alcoa and the Italian Government agreed to a temporary curtailment of the Fusina smelter. As of June 30,
2010, the Fusina smelter was fully curtailed. Additionally, in January 2012, as part of a restructuring of Alcoa’s global
smelting system, Alcoa announced that it had decided to curtail operations at the Portovesme smelter during the first half
of 2012. In March 2012, Alcoa decided to delay the curtailment of the Portovesme smelter until the second half of 2012
based on negotiations with the Italian government and other stakeholders. In the third quarter of 2012, Alcoa began the
process of curtailing the Portovesme smelter, and it has since been fully curtailed as of November 2012 with all 150,000
mtpy idled. This action may lead to the permanent closure of the Portovesme smelter.
8In January 2012, Alcoa announced its intentions to partially and temporarily curtail its Avilés and La Coruña smelters.
The partial curtailments were completed in the first half of 2012. As a result of a modification to the load interruptibility
regime currently in place in the Spanish power market, Alcoa has commenced the restart of a portion (25,000 mtpy
combined for Avilés and La Coruña) of the capacity previously curtailed in the first half of 2012 in order to meet the
requirements of the modified interruptibility regime. See the Management Discussion and Analysis of Financial
Condition and Results of Operations section for more information.
9Between June and November 2008, three of Rockdale’s six potlines were idled as a result of uneconomical power prices.
The remaining three operating lines were idled in November 2008 due to uncompetitive power supply and overall
market conditions. In January 2012, Alcoa announced that it will permanently shut down and demolish two of the six
idled potlines as part of a larger strategy to improve its cost position and competitiveness. The remaining four potlines
(191,000 mtpy) remain idled.
10 Approximately half of one potline at the Intalco smelter remains idled, approximately 45,200 mtpy.
11 One potline at the Wenatchee smelter remains idled, or approximately 41,000 mtpy.
As of December 31, 2012, Alcoa had approximately 591,000 mtpy of idle capacity against total Alcoa Consolidated
Capacity of 4,227,000 mtpy.
All production at the Tennessee smelter was idled in March 2009 due to economic conditions. In January 2012, Alcoa
announced that it would permanently shut down the 215,000 mtpy facility as part of a larger strategy to improve its
cost position and competitiveness. Demolition and remediation are ongoing.
In January 2011, Alcoa and China Power Investment Corporation (CPI) signed a Memorandum of Understanding
(MOU) to collaborate on a broad range of aluminum and energy projects in China and other locations. The projects
under consideration may range from mining, refining, smelting, and aluminum fabrication to collaboration on energy
projects. A new joint venture company, established in November 2012, is discussed below under the Global Rolled
Products segment.
As noted above, Alcoa and Ma’aden are developing an aluminum smelter in the Kingdom of Saudi Arabia. The smelter
is expected to have an initial capacity of ingot, slab and billet of 740,000 mtpy. First hot metal was produced on
December 12, 2012.
In December 2008, Alcoa and the Brunei Economic Development Board agreed to further extend an existing MOU to
enable more detailed studies into the feasibility of establishing a modern, gas-powered aluminum smelter in Brunei
Darussalam. The MOU extends a memorandum signed originally in 2003. Phase one of the feasibility study will
determine scope and dimensions of the proposed facility, power-delivery strategy, location, as well as an associated
port and infrastructure. At completion of phase one, the parties will determine whether a more detailed phase two study
is warranted. If completed, it is expected that the smelter would have an initial operating capacity of 360,000 mtpy with
the potential for future increase. In 2012, the MOU was further extended to enable determination of feasibility.
In 2007, Alcoa and Greenland Home Rule Government entered into an MOU regarding cooperation on a feasibility
study for an aluminum smelter with a 360,000 mtpy capacity in Greenland. The MOU also encompasses a
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