Australia's Bell Bay aluminium smelter reached a new 13-year power supply deal to help secure the long-term future of the 182,000-tonnes-a-year plant in the face of depressed market conditions, miner Rio Tinto said on Thursday.
The 57-year-old smelter, located in the island state of Tasmania, is among an estimated $8 billion worth of assets bundled by Rio Tinto into its newly formed Pacific Aluminium division ahead of a possible divestment.
Terms of the power contract with the state-owned supplier Hydro Tasmania were not disclosed.
Bell Bay general manager Ray Mostogl said in a statement tough market conditions were expected to continue for some time. The price of aluminium is down more than 20 percent this year.
Rio Tinto in October signalled a major retreat from its aluminium business, putting aluminium-related assets up for sale across six countries, only four years after buying aluminium giant Alcan for $38 billion. To date, no assets have been sold.
The move has been interpreted as a way of diverting yet more resources to iron ore, which now accounts for nearly 80 percent of group earnings.
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