Norsk Hydro (NHYDY) announced overnight that its alumina refinery Alunorte in Brazil is preparing for full curtailment of its operation. The decision was taken as the bauxite residue deposit area 1 is close to reaching its capacity, due to the embargo on the state-of-the-art press filter and the newly developed bauxite residue deposit area. Alunorte has been running at 50% production since March, following embargos from Brazilian authorities, the company said.
It added, “Environmental authorities have confirmed that there was no spill or overflow from the residue areas. The embargos have prevented Alunorte from utilizing the newest bauxite residue deposit area, which was under commissioning in February, as well as the state-of-art press filter technology, representing an investment of more than BRL 1 billion. The press filter is the most modern and sustainable technology for depositing bauxite residue, reducing the required storage area and environmental footprint. Alunorte has since the embargo made efforts towards authorities for permission to utilize the press filter, as well as DRS2, without success. Due to the embargo, Alunorte has been forced to operate only DRS1, which was originally planned to be phased out, and the less efficient drum filters. DRS1 is, therefore, approaching its end of life faster than anticipated, forcing Alunorte to take the responsible decision to temporarily shut down 100% of its operations. This will have an immediate effect on the bauxite mine Paragominas, which will also shut down 100% of operations. Both Alunorte and Paragominas have initiated the shutdown process safely”.
Following the announcement shares of Century Aluminum are down 13%, or $1.59, to $10.31 while Alcoa (AA) is up 7%, or $3.01, to $44.58.
