Rio Tinto Alcan to invest US$487 million in Icelandic smelter

LONDON, United Kingdom, Oct. 1 /CNW Telbec/ - Rio Tinto Alcan has today announced an investment of US$140 million in a leading-edge casting facility to produce value-added billet at its aluminium smelter in Straumsvik, Iceland (ISAL), bringing total investment announced in recent weeks in ISAL to US$487 million.

Rio Tinto Alcan announced on 23 September a US$347 million investment to modernise and increase the ISAL smelter's capacity by 20 per cent following the completion of a long-term energy supply agreement with Landsvirkjun, the Icelandic power utility.

"Expanding production capacity and investing in a new casting facility at ISAL is part of our strategy of developing our top-tier assets. ISAL has a clean energy source in hydro power, low CO(2) emissions and strong performance on health, safety and the environment. The investment will help us continue to deliver reliable and high quality products to our customers," said Jacynthe Côté, chief executive, Rio Tinto Alcan.

The investment will reinforce Rio Tinto Alcan's market position in Northern Europe and demonstrates its long-term commitment to being a stable supplier of high-quality billet. Billet production is expected to commence in 2012.

The smelter is expected to commence the gradual increase of its production in April 2012 and complete the production increase by July 2014.

In conjunction with its US$140 million investment, Rio Tinto Alcan will consolidate the expertise and production for the slab products from ISAL with existing operations in France and the UK.

The ISAL smelter started up in 1969. The facility houses 480 pots in three potrooms and employs approximately 450 people.

About Rio Tinto

Rio Tinto is a leading international mining group headquartered in the UK, combining Rio Tinto plc, a London and NYSE listed company, and Rio Tinto Limited, which is listed on the Australian Securities Exchange.

Rio Tinto's business is finding, mining, and processing mineral resources. Major products are aluminium, copper, diamonds, energy (coal and uranium), gold, industrial minerals (borax, titanium dioxide, salt, talc) and iron ore. Activities span the world but are strongly represented in Australia and North America with significant businesses in South America, Asia, Europe and southern Africa.

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