Alcan fed up with Kitimat mayor's 'vendetta'

How badly does Alcan want to continue producing aluminum in Kitimat?

Badly enough to spend $2 billion on a new smelter to replace its old, inefficient one, says Alcan Primary Metal Group's new president and CEO, Michel Jacques.

But not badly enough, Jacques warns, to put up with too much more guff from Kitimat Mayor Richard Wozney and other crusaders who've been waging what he calls a "vendetta" and a "war" against the company.

Alcan lost a sweet deal with BC Hydro in late December when the Public Utilities Board agreed with critics who maintained the Crown corporation offered to pay too much for surplus electricity from Alcan's Kemano dam, which also feeds cheap power to its Kitimat smelter.

But the company won big last week with a court ruling that it can sell power if it wants to. In other words, it's not required, as Wozney et al have long argued, to use it for smelting or lose the cheap water rents it was granted more than half a century ago.

So now, it seems, nothing prevents Alcan from abandoning the smelter altogether and just selling electricity for, its critics calculate, stunningly high profits.

That should be the critics' worst nightmare, because it's just what they've maintained all along that Alcan will end up doing. They stop just short of calling company spokesmen liars, but maintain that, as long as there are no strings to limit the end-use for the power, it's the most profitable option and therefore the one that will win out.

Jacques disagrees. He told The Vancouver Sun's editorial board on Monday that the company's job is to make aluminum, and it hasn't considered converting its Kitimat operations to power sales alone. But selling the surplus -- something it has done since it set up shop in the 1950s -- is key to making the $2-billion investment pay.

This could, of course, change.

"If they continue with their vendetta, their war, and do everything they can to stop this investment," he said, then Alcan will be forced to reconsider its plans.

And, "There's a limit to how much trashing Alcan will accept to its reputation and its name." (He added that the company can't silence it critics, but it can take itself out of their line of fire.)

If I were Mayor Wozney or his right-hand man, municipal manager Trafford Hall, I'd find that a chilling warning.

After all, Alcan pays 45 per cent of Kitimat's taxes. And, even though its workforce has shrunk by about a third over the years, it's still the only major employer in town. The new smelter, if built, will employ only 1,000 -- down from 1,500 who work there now -- but that remains a hefty number in a town with few job-producing alternatives in sight.

But Wozney and Hall don't seem to be getting the message that enough might be enough.

A news release last Friday expressed council's disappointment with the court ruling, and predicted Alcan would continue selling more and more power instead of smelting ore.

Wozney was too busy to talk to me on Tuesday, but Hall took 45 minutes to recap why he believes Alcan can't be trusted, and to not answer my one question: What next? "Considering our options," one of which is to appeal within 30 days, is the only answer I got.