AluNews - October 2006

Russian aluminium plant for Queensland

Daily Telegraph, Australia - Sep 29, 2006

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RUSSIAN aluminum giant Rusal will build an electricity power station and aluminum plant in Queensland at an estimated cost of $US3.5 billion ($4.7bn), Russian daily Gazeta reported today.

The station could generate 500 to 1100 MW of electricity, which would power the plant to produce up to 690,000 tonnes of primary aluminum, the daily quoted Antanta Capital metals analyst Vladimir Popov as saying.

This would increase Rusal's current primary aluminum production by 25 per cent, Mr Popov said.

The project would take advantage of Australia's position as the world's largest producer of bauxite, the main component in aluminum.

Rusal is the largest producer of aluminum in Russia and the second-largest in the world, after US Alcoa.

Rusal had revenues of $US6.65bn in 2005, and employs about 50,000 people in Russia and 13 other countries.

Russian metals deal could be signed on Monday

Scotsman, United Kingdom - Oct 1, 2006

NEW YORK (Reuters) - A deal to create a Russian metals giant is likely to be signed as early as Monday, the Wall Street Journal reported on its Web site on Sunday, citing people familiar with the talks.

Under the deal, Russia's Rusal Ltd. will take over smaller domestic rival Sual Group and the alumina assets of Swiss commodities trader Glencore International AG to create a new company with an estimated market value of $30 billion, the WSJ said.

That would be capable of challenging Alcoa Inc. as the world's biggest aluminium producer.

RUSAL, currently the world's No. 3 aluminium producer behind Alcoa Inc. and Alcan Inc. , signed a memorandum in August to create a $30 billion company in which it would control 64.5 percent, sources close to the deal have previously told Reuters. SUAL would control 21.5 percent and Glencore 14 percent of the merged company, the sources said at the time.

A source close to the deal told Reuters on Thursday that RUSAL and SUAL may exclude the alumina assets of Swiss trader Glencore in the merger.

RUSAL and SUAL were not immediately available for comment.

(c) Reuters 2006

ALCAN SIGNS MULTI YEAR AGREEMENT TO SUPPLY BOMBARDIER AEROSPACE

Press Release - ALCAN INC. Tuesday, October 03, 2006 3:16:00 PM EST

SUPPLY OF ADVANCED LIGHTWEIGHT ALUMINUM PRODUCTS TO COME FROM COMPANY’S RAVENSWOOD MILL

Ravenswood, West Virginia, USA — Alcan Rolled Products – Ravenswood, a wholly owned subsidiary of Alcan Inc., has signed an agreement with Bombardier Aerospace to supply the aircraft manufacturer with advanced lightweight aluminum products. The supply agreement will support Bombardier’s major aerospace programs including the CRJ* Series and Q-Series* regional aircraft, and Learjet* family of business jets.

"This agreement clearly demonstrates Alcan’s commitment to a long-term cooperation with Bombardier Aerospace," said Michel Jacques, President and Chief Executive Officer, Alcan Engineered Products following the signing. "It also represents a significant milestone in expanding Ravenswood’s strong and diversified supply position into the regional and business aircraft segment," he added.

Ravenswood is one of the largest aluminum rolling mills in the world and produces high quality aluminum plate, coil and sheet products for the aerospace, aeronautical and transportation industries. The plant's innovative lightweight products make an important contribution to the further development of high-tech aerospace solutions, meeting customers’ evolving requirements for reduced manufacturing costs and optimum weight/performance ratios.

Alcan Inc. (NYSE, TSX: AL) is a leading global materials company, delivering high quality products and services worldwide. With world-class technology and operations in bauxite mining, alumina processing, primary metal smelting, power generation, aluminum fabrication, engineered solutions as well as flexible and specialty packaging, today’s Alcan is well positioned to meet and exceed its customers’ needs. Alcan is represented by 65,000 employees in 61 countries and regions, and posted revenues of US$20.3 billion in 2005. The Company has featured on the Dow Jones Sustainability World Index consecutively since 2003. For more information, please visit: www.alcan.com.

* Trademarks of Bombardier Inc. or its subsidiaries.

Det.Al Limited to build aluminum plant in Ganja

Baku Today, Azerbaijan 10/10/2006 20:57

Det.Al Limited Co. will construct a new aluminum plant in Ganja. The annual production capacity of the high-tech plant will be 100 000 tonnes, Corporate Management Officer Serkhan Babayev, APA reports.

He said DEt.Al and Azerbaijan-Aluminum OJSC signed an agreement.

"Azerbaijan-Aluminum consists of a plant in Sumgait in the annual capacity of 30 000 tonnes of aluminum and a plant in Ganja in annual capacity of 450 000 tonnes of clayey-soil. An Investment Program will be implemented to increase the capacity of Sumgait plant to 60 000 tonnes. /APA/

Major Assets of Merged Company 'Russian Aluminum'

Financial Information Service(Registration), Russia 10.10.06

MOSCOW, October 10. /FIS/. According to RUSAL, the merged company 'Russian Aluminum' will include the following RUSAL's assets: Bratsk, Krasnoyarsk, Novokuznetsk and Sayanogorsk aluminum plants, Achinks Alumina Combine, Nikolaevsk and Boxitogorsk Alumina Plants and others.

Contribution of SUAL Group includes: Irkutsk, Ural, Kandalaksha, Bogoslovsk, Volgograd and Volkhov aluminum plants, Zaporozhie aluminum combine and others.

Glencore International AG contribution is alumina plants Aughinish in Ireland, Windalco and Alpart on Jamaica, Eurallumina in Italy and the aluminum plant Kubikenborg in Sweden.

Chalco to invest 6 billion yuan on an aluminum-power project in north China

Trading Markets, CA - Oct 9, 2006

BEIJING, Oct 9, 2006 (Xinhua via COMTEX) -- China's leading alumina supplier

Aluminum Corp of China (Chalco, NYSE: ACH, HK: 2628) plans to invest

some 6 billion yuan constructing an aluminum-power associated project

for Fushun Aluminum Smelter in northeast China's Liaoning Province.

The project will involve with an electrolytic aluminum smelting

unit with an annual production capacity of 190,000 tons; and two

accessory electric-power units with a capacity of 300,000 kilowatts.

The National Development and Reform Commission (NDRC) is

investigating the project at present.

The project is expected to be completed within three years. Spain's Telefonica to increase CNC shares BEIJING, October 9 (CEIS) -Spanish telecom company Telefonica will raise its shares of China Network Communications Corporation ( CNC, NYSE: CN)) from current 5 percent to 9.9 percent, company chairman Zhang Chunjiang revealed in an article published lately by official Qiu Shi magazine.

Though China's has become the world's No.1 telecom market in

terms of user number, Zhang said the country's telecom industry

still lacks competition.

He believed that the country must speed up the integration of

telecom network, Internet and broadcasting network to bring all these

networks into better use and enable users to have packaged services.

Moreover, strategic investors and private capital can be

introduced into telecom operators so as to enrich telecom companies'

financial power and realize company shareholding diversifications,

said Zhang.

He also emphasized the importance of tapping international markets.

With such an objective, telecom corporations can purchase shares of

overseas telecom counterparts at the very beginning, he said.

Copyright 2006 XINHUA NEWS AGENCY

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SUAL to Pay for Construction of Nuclear Station

Kommersant, Russia - Oct 9, 2006

Russian Federal Atomic Energy Agency (Rosatom), SUAL and government of the Murmansk region have agreed to construct in the Kola Peninsula a new aluminum plant and the second stage of the Nuclear Power Station, which will ensure the work of the plant. It is the first time in Russia that the private capital funds construction of a nuclear power station.

Rosatom, SUAL, government of the Murmansk region and a number of other divisions sealed a cooperation protocol Friday, which ties SUAL’s project for constructing an aluminum plant (capacity of up to 1 million tons) in the Kola Peninsula to construction of the second stage of the Kola Nuclear Power Station, which will produce electric power for this aluminum facility.

The first stage of the aluminum plant could be put into operation already by 2010 to 2011, and the second one will be probably launched by 2013 to 2015. The second stage of the Kola Nuclear Power Station will start operating in 2013.

"The project investments depend on what unites will be constructed in the Kola Nuclear Power Station," said Rosatom chief Sergey Kiriyenko. "A standard unit of 1,200 MW costs 55 billion rubles to 56 billion rubles. But the 1,200-MW unit that we intend to produce in series won’t do here because of network restrictions. It will be necessary to construct a unit for 640 MW or 440 MW."

www.kommersant

Optimism at aluminum smelter

Bellingham Herald, WA - Oct 8, 2006

Intalco is confident about next 5 years; long-term power solution will determine rest

Bob Bell has learned that when it comes to the economy, consumer confidence is a big deal.

Bell, who has owned the downtown Ferndale Mini Market since 1977, learned that lesson five years ago when Alcoa Intalco Works began struggling to stay open because of higher energy costs.

"You could tell money was tighter, even for those who still had jobs," Bell said. "The uncertainty kept people from spending, and that hurt the local economy."

With the announcement on Sept. 30 that Intalco was going to ramp up production by restarting a second potline and adding 170 jobs, Bell is feeling upbeat about the economy, particularly in the Ferndale area. Intalco is planning to have the potline running sometime early next year.

"The timing couldn't be better for Ferndale," Bell said. "The community has spent the past six months talking about economic development and there is already a certain amount of enthusiasm being generated. The news about these new jobs tells the community that Intalco means to stay in the community and not fade away. That's a great confidence builder."

While the announcement of more jobs at Intalco is considered great news by many, it remains to be seen what kind of economic impact it will have.

Jim Vleming, a regional labor economist who focuses on employment trends, wonders what the confidence level will be for those new hires.

"If I'm one of those 170 people hired by Intalco, I have to wonder how long my job will last," Vleming said. "That might impact a lot of decisions on whether I go out and make big purchases, such as buying a car or a home."

That uncertainty is a dilemma that Intalco Plant Manager Mike Rousseau will have to contend with, but it's something he's dealt with before.

"If a new employee were to ask me about the long-term future, I would tell them we're hopeful," Rousseau said. "I believe opening a second potline shows how optimistic we are. It's not something we can do on a whim, and I think the action says we expect to stay open and continue to be a productive facility for a long time."

"ALL THE PIECES FELL INTO PLACE"

Several factors took Intalco from the brink of shutting down to its latest announcement to add employees and increase production.

Signing a five-year contract with the Bonneville Power Administration was important to the company's survival, but the growing demand for aluminum is also important.

The price for the commodity is at its highest level in 18 years. Alcoa spokesman Kevin Lowery said in a recent interview for a Reuters article that demand for aluminum is expected to double in the next 14 years.

On a company level, Alcoa idled its plant in Frederick, Md., in December because it could not reach a long-term power arrangement, so some of customers at that plant could be shifted to Intalco.

Rousseau said those market factors created enough demand that they expect the second potline to be open for at least the next five years, when the current contract with BPA expires.

"We're confident we will make it to 2011 with two potlines in operation," Rousseau said. "What is important to us is finding a long-term power solution. This is not a dying facility; it's one of the youngest in the United States and Alcoa wants to keep using it."

What could be a challenge is finding qualified employees, Rousseau said.

"Right now the local unemployment level is low. We are looking for people who were previously laid off, but some have moved on to new careers," Rousseau said. "We plan to continue working with the Bellingham Technical College on developing programs to get trained millwrights and electricians for the future."

COMMUNITY IMPACT

According to the U.S. Bureau of Economic Analysis, for every job created in a manufacturing facility like Intalco, an additional one to one-and-a-half jobs are created in the community.

It will be difficult to see if it happens here because there is so much happening in the local economy, said Hart Hodges, director for the College of Business and Economics at Western Washington University.

"There are just so many dynamics involved in an economy this size," Hodges said. "If there were a slowdown in the real estate market, for example, it would overshadow anything that is happening at Intalco."

In addition to the 170 people Intalco plans to hire, Rousseau expects to subcontract some of the work involved in getting the second potline open.

"We plan on doing what we can to get the second potline open by the beginning of the year," Rousseau said. "It is difficult to say how much, but we will have contract work for before and after the potline is running."

Whatever the impact is, Bell expects it to be one more piece to stronger economic times in Ferndale.

"It's been a good business year for my store, especially compared to last year, when the bridge (on Main Street over the Nooksack River) was under construction," Bell said. "There seem to be a lot of different things that have been positive economically, and the Intalco news is another example."

Reach Dave Gallagher at 715-2269 or dave.gallagher@bellinghamherald.com.

Aluminum mega-holding set up in Russia

RIA Novosti, Russia 10-Oct-2006

Aluminum giants RusAl and SUAL, and Swiss raw materials trader Glencore, have announced the creation of United Company Russian Aluminum based on their combined assets. The new company will corner most of the world aluminum and alumina market, getting ahead of such giants as Alcan and Alcoa.

Russian Aluminum plans to spend $3-3.5 billion on production development in the next five years.

"With an alliance with Glencore under their belt, the Russian partners can build aluminum smelters in Russia without troubling themselves with alumina supplies, which will be sufficient," said Igor Nuzhdin of Solid brokerage.

"If they are to opt for more intensive means, they should choose a higher degree of conversion, something Alcoa did in its day." In this case, the analyst said, the Russian mega-holding may also take over aluminum component supplies to aircraft manufacturers.

This issue is particularly high on the order of the day now that European aluminum companies have refused to supply spare parts to Airbus.

"Conceivably, future Airbus needs might be satisfied by Russian producers, and some agreement seems to have been negotiated," said Nuzhdin. "But to do this the holding must solve the problem of turning out a new assortment of products."

Lately it has become habitual for the state to take Russian strategic companies under its control. The world's largest aluminum producer may safely be ranked among such, but analysts expect the company to remain independent, if only formally.

"State intervention in this private company may scare off investors from its future IPO and lose the present owners expected returns," said a market expert who wished to remain anonymous. "In the 18 months left before the IPO, the state, acting as a bystander, will try to direct the new structure in the required direction without emphasizing its participation."

The source said no means of administrative pressure will be needed for this -- the aluminum producers are interested in preferential treatment from power companies and will themselves propose some or other barter scheme.

"Even after the IPO, the aluminum giant will not go under state administration, although it will be heavily dependent upon the state," the expert said.

Noble Group Limited Interested in Business Venture in Azerbaijan – Executive Director

TREND Information, Azerbaijan - 10.10.2006

Author: S.Babayeva

Richard Elman, the Executive Director and founder of Noble Group Limited Company stated his company’s interest in conducting business in Azerbaijan, Trend reports.

The company, who has over 70 offices in 42 countries, specializes in the supply of raw material for agriculture and industry as well as providing financial and logistics service.

"We would be able to set up projects in all spheres once the business is running. We co-operate with relevant companies specialized in the production of metal and are very interested in expanding relationships," he stated. Last year the company’s net profit was $231mln.

Elman added that the company has been involved with other companies in long-term partnerships, in particular with Det.AL Limited, in the purchase/sale of aluminum and alumina. They are keen to expand and develop the partnership relations.

Alcan looks for expansion

Ottawa Citizen (subscription), Canada - Oct 7, 2006

Montreal-based Alcan Inc. is looking to expand alumina production in countries from Brazil to Guinea after being hurt by surging prices for the metal used to make aluminum. Alcan is "interested" in boosting its stake in the 2.1-million-tonne Alumar refinery in Brazil and expects to start "basic engineering" on a 1.5-million tonne refinery in Guinea by year's-end, Jacynthe Cote, head of Alcan's bauxite and alumina business, said in an interview. "We are being very active in screening options in the key, top six or seven bauxite-rich countries," Ms. Cote said. Alcan is interested in expanding and starting new projects in countries such as Guinea, Brazil, India, Vietnam and Australia, she said.

Alcoa says Iceland smelter 75% complete; 2Q 2007 start-up

MarketWatch - Oct 11, 2006

LONDON (MarketWatch) -- Alcoa Inc's (AA) Fjardaal aluminum smelter in Iceland is now 75% complete and is expected to produce its first metal in the second quarter of 2007, the company said late Tuesday.

The smelter will be operated by Alcoa Fjardaal, a wholly owned subsidiary of Alcoa and will have a production capacity of up to 346,000 metric tons a year. At start-up, production capacity is estimated to be 322,000 tons a year, but this is expected to increase later due to higher amperage and more efficient use of the pots.

Power for the smelter will come from the Karahnjukar hydropower plant.

-Contact: 201-938-5400

Deripaska to Step Down

The Moscow Times, Russia Tuesday, October 17, 2006

Russian Aluminum's billionaire owner, Oleg Deripaska, who is buying SUAL Group and some of Glencore International AG's assets to create the world's biggest aluminum company, will resign as chairman as part of the deal.

Deripaska, 38, will remain on the board of RusAl, while his position as chairman will be taken by Andrew Michelmore, chief executive of En+, RusAl and En+ said Monday in a joint e-mailed statement. En+, part of Deripaska's holding company, Basic Element, was set up in February to manage its energy, power and aluminum assets. (Bloomberg)

Kitimat fading, mayor tells B.C. top court

Globe and Mail, Canada 17-oct-2006

Community shrinking since Alcan cut aluminum production, Chief Justice told

TERRI THEODORE, Canadian Press

VANCOUVER -- The population of the northwestern B.C. community of Kitimat has dropped by 2,000 to 3,000 since Alcan Inc. started selling power while cutting back on aluminum production, Mayor Richard Wozney says.

Kitimat is fighting the aluminum giant and the B.C. government over the power sales.

The District of Kitimat's lawyer, John Hunter, told Chief Justice Donald Brenner of the B.C. Supreme Court yesterday that the 56-year-old Industrial Development Act prevents Alcan from selling off anything but surplus power.

Yet over the past six years, Mr. Hunter said, Alcan has been cutting back aluminum production in favour of selling lucrative electricity into the B.C. Hydro power grid.

"Since that time, Alcan has not operated its smelter at full capacity, but it continues to sell Kemano power to Hydro," he said.

The petition to the court is a latest in a series of legal procedures between Kitimat, the province and Alcan.

The smelter's power sales are authorized by a decade-old exemption order given to the company by the B.C. government.

Mr. Hunter said the key issue for the court to decide is whether that legislation was meant to restrict the use of power to the development and benefit of B.C.'s northwest.

Kitimat, whose population is about 11,500, sprang up in the early 1950s after the provincial government gave Alcan the water resources of the Nechako and Kemano River systems to generate the massive amount of electricity the company needed for its smelter.

Mr. Wozney, the mayor, said that since 2000 Alcan has cut back its smelter capacity by up to 87 per cent, which has been devastating to his community.

"We've lost 2,000 to 3,000 people," he said. The vacancy rate in the district is 45 per cent, two elementary schools have been closed and businesses are moving out.

"We're shrinking," Mr. Wozney said "And it's all because of Alcan power sales."

Chief Justice Brenner noted during Mr. Hunter's argument that Alcan started selling electricity when the need for power in North America spiked six years ago. "Electricity became more valuable than aluminum," the judge added.

"Precisely," Mr. Hunter agreed.

Mr. Wozney said Alcan is selling off B.C. resources for its own gain and the government is allowing that.

"Alcan's making all the profits here," he said. "And British Columbians are getting very little benefit from that."

Mr. Wozney estimated Kitimat taxpayers have spent hundreds of thousands of dollars on court costs fighting to reverse the Alcan power sales.

The B.C. Court of Appeal ruled this year that because the district wasn't involved in the agreement, it had no standing to challenge Alcan's compliance with the Industrial Development Act.

This time, the district is petitioning the court to decide whether the province and Alcan are misinterpreting the act by allowing the electricity sales.

Mr. Wozney said that for five years, the community has been fighting with Alcan and the province for its survival.

"We would expect that the B.C. government would not only be representing all the people in British Columbia, but all the people in Kitimat.

"I don't understand why the politicians in Victoria are not as sympathetic to our cause."

The hearing into the petition is expected to continue for about 10 days.

Bauxite mining a threat to Jamaica's plant life

Miami Herald, FL Wed, Oct. 18, 2006

BY GEORGIA TASKER gtasker@miamiherald.com

The limestone formations that define Cockpit Country hold deposits of bauxite, from which aluminum is made. The mining of bauxite may be the greatest danger facing the forest's plants and animals.

To mine bauxite, bulldozers remove topsoil and dig out the mineral. The soil is replaced and replanted with grass or agricultural crops.

Should a forest reserve such as Cockpit Country be mined, the government will replant trees, says Marilyn Headley, Jamaica's conservator of forests.

Yet the damage is irreparable, environmental groups say.

Alcoa, the world's largest producer of aluminum, has been prospecting for bauxite in Cockpit Country since 2004. The company's license expired in May, but it is expected to be renewed.

''We are well aware of the environmental sensitivity and cultural significance of Cockpit Country and, as always, remain open to discussion with any group that is interested in our activities,'' Kevin Lowery, a spokesman with Alcoa, said via e-mail.

The Jamaica Environment Trust is looking into legal technicalities that may be useful in preventing mining in the forest reserve.

Bauxite is a major driver of Jamaica's economy, generating $900 million in 2004, with $370 million of that staying in the country, according to the Jamaica Information Service. The country is the fifth-largest bauxite producer in the world.

Hindalco Industries Business Outlook and expansion plans

Equity Bulls, India 18_Oct-2006

Hindalco Industries Ltd has announced the following Outlook:

Expansion Projects:

Muri: The brownfield expansion from 110,000 TPA to 450,000 TPA, at Muri Alumina Refinery is in its final stages of completion, and is expected to be commissioned by the first quarter of next fiscal.

Hirakud: The commissioning of Phase I (65,000 TPA to 100,000 TPA) of the expansion of Aluminium capacity has begun before time. Ten pots were energized on September 28, and the ramp up is underway. A total of 150 pots will be commissioned by the year end, ahead of schedule.

Phase II of the project, which entails raising capacity from 100,000 TPA to 143,000 TPA is moving smoothly and is slated for commissioning on schedule.

Belgaum: For the expansion of Alumina Refining capacity at Belgaum, Karnataka from 350,000 TPA to 650,000 TPA the leases for bauxite mining are yet to be allotted.

Utkal: Notwithstanding inclement weather, work at the site of the 1.5 million TPA greenfield Alumina Refinery project in Orissa is on track. Preparation of pile foundation and plant infrastructure is on track. Land acquisition is complete and detailed engineering has commenced.

Aditya Aluminium: The greenfield integrated 1.5 million TPA Alumina Refining and 325,000 TPA Aluminium smelting project in Orissa is on course. The project has received approval for SEZ status for the Smelter. The bauxite mining plan has been approved by the Indian Bureau of Mines, Bhubaneswar. Land acquisition and the R&R packages are progressing well.

Bargawan: The Company has signed an MoU with the Government of Madhya Pradesh, for setting up a 325,000 TPA Aluminium smelter and a 750 MW Power Plant at Bargawan, Sidhi District, Madhya Pradesh. This project has been granted SEZ status as well.

Mahan Coal block has been allotted to the Essar-Hindalco JV entity- Mahan Coal Company Ltd. The key management personnel are being located here. Permissions have been obtained for additional drilling for assessment of coal reserves and the formulation of a mine plan. The Topographical Survey for contour mapping, identification of villages, number of houses and households, roads, mapping of land records etc has begun.

The Topographical Survey has been completed for Smelter. Applications for acquisition of appx. 5,000 acres of land shall be filed by next month. The project has received concurrence approval for sourcing 45 Cusecs of water p.a. from the nearby Gopad River.

Jharkhand: The Company had signed an MoU in 2005 with the Government of Jharkhand for a 325,000 TPA aluminium smelter and a 750 MW power plant. The Company is awaiting allotment of a coal block in line with the terms of the MoU.

Selection of land has been finalized. An application for the acquisition of 5,322 acres of land was submitted to JIIDCO in July’06. Applications for water, construction power and other necessary infrastructure are being put up.

Industry Outlook:

Aluminium:

Global primary aluminium consumption has witnessed strong demand growth of 7% in the April-September 2006 period.

US aluminium consumption growth is expected to slowdown with higher interest rates and weaker construction activity in the residential segment. Demand from Western Europe has been relatively stronger, while that from Japan continued to be unexciting. China remains the strongest driver of the demand for the metal with semis capacity mushrooming in the country. However as a fallout of the rapid development in semi-fabrication capacity in China of Primary Aluminium consumption in the East & South East Asian region may be impacte

Alcan to acquire full ownership of cathode business in France

American Digital Networks (press release), MD Oct. 19, 2006

PARIS, France, Oct. 19 PRNewswire-FirstCall - Alcan is in advanced discussions with GrafTech International Ltd (NYSE: GTI) to acquire the remaining 70 percent stake of Carbone Savoie and certain related technology and equipment for approximately US$130-140 million. Under the current structure, Alcan currently owns 30 percent of Carbone Savoie, a global leader in the design and production of cathode blocks. The proposed transaction will be submitted to the Works Council consultation process in France and is expected to be completed in the fourth quarter 2006, following regulatory approval. Final terms will be disclosed upon completion.

"This investment will strengthen Alcan's AP Series smelting technology platform and help to accelerate the development of potential breakthrough technologies," said Cynthia Carroll, President and Chief Executive Officer, Alcan Primary Metal Group. "It will also secure Alcan's supply of cathode products for our current operations and extensive new project pipeline," she added.

Today, Alcan's proprietary world-leading AP Series Smelting Technology already utilizes Carbone Savoie's advanced graphitized cathode blocks.

"In acquiring full ownership of Carbone Savoie, Alcan will strengthen its commitment to aluminum smelting technology development in Europe and more particularly in France," said Jean-Philippe Puig, President, Europe, Alcan Primary Metal Group. "Through Alcan's Integrated Management System (AIMS), which includes a rigorous approach to environment, health and safety (EHS FIRST), Carbone Savoie would be fully integrated into Alcan, benefiting customers, employees, and shareholders alike," he added.

With revenue of approximately US$114 million in 2005, Carbone Savoie is a leading and profitable producer of cathode blocks, including a growing share of graphitized cathode blocks, as well as sidewall blocks and ramming paste. Cathodes are essential to the production of aluminum, as they act as conductors in the electrolysis process. GrafTech's cathode business employs approximately 500 people at two sites, both in close proximity to Alcan's European Primary Metal headquarters and research and development centre in Voreppe, France.

Alcan Inc. (NYSE, TSX: AL) is a leading global materials company, delivering high quality products and services worldwide. With world-class technology and operations in bauxite mining, alumina processing, primary metal smelting, power generation, aluminum fabrication, engineered solutions as well as flexible and specialty packaging, today's Alcan is well positioned to meet and exceed its customers' needs. Alcan is represented by 65,000 employees in 61 countries and regions, and posted revenues of US$20.3 billion in 2005. The Company has featured on the Dow Jones Sustainability World Index consecutively since 2003. For more information, please visit: www.alcan.com.

Ormet to shut down Louisiana operation

KATC, LA 10_20_2006

BURNSIDE, La. -- Citing a dramatic drop in alumina prices, aluminum maker Ormet Corp. said Friday that it would close down its alumina division in Louisiana by the end of the year, costing 250 workers their jobs.

Ormet said it expected, at some point, the Burnside refinery would reopen.

"The refinery has shut down and reopened several times in the past 20 years, and I expect that's what will happen again," Ormet Chief Executive Officer Ken Campbell said in a statement. "We kept the facility open as long as we could this time, and did everything in our power to avoid a closure."

The company said the price of alumina has dropped from more than $600 per ton in April to $250 per ton. Campbell said it would be at least a year before the refinery could be restarted.

Employees were given 60-day layoff notices and will shut down the plant to allow a quick restart if market conditions improve, Ormet said.

Ormet, based in Wheeling, W. Va., has about 2,000 employees and other operations in Ohio, West Virginia, Indiana and Louisiana.

AEP, Ormet reach power agreement

Business First of Columbus - 4:50 PM EDT Friday 10_20_2006

AEP Ohio said Friday it will provide power to Ormet Corp.'s aluminum plants in Hannibal, in Monroe County, pending regulatory approval.

Ormet has been a customer of Lancaster-based South Central Power Co., but last year filed a complaint with the Public Utilities Commission of Ohio that the company was providing inadequate service. Ormet requested a switch to AEP Ohio, which had supplied power before Ormet switched to South Central Power in 2000.

Ormet said it expects to receive PUCO's approval for the deal within the next few weeks. If approved, service through AEP Ohio will start Jan. 1.

Canonsburg, Pa.-based Ormet is a privately held company that posted $600 million in sales in 2005, according to business research firm Hoover's Inc.

AEP Ohio is a subsidiary of Columbus-based American Electric Power Company Inc. (NYSE:AEP). The company delivers electricity to more than 5 million customers in 11 states, while AEP Ohio serves 1.5 million in Ohio and the northern panhandle of West Virginia through Columbus Southern, Ohio Power and Wheeling Power Co. AEP posted $12.1 billion in revenue last year.

Greenspan Slams Russia's Industry Titans

AND, South Africa October 20, 2006

By ANDnetwork .com

NEW YORK -- Former U.S. Fed chief Alan Greenspan on Thursday criticized Russia's national champions as economically harmful and anti-competitive. Greenspan, one of the world's most respected financial minds, said the very idea of creating industry titans blessed by the state was antithetical to modern capitalism because it protected corporations that were inherently less competitive.

Greenspan, one of the world's most respected financial minds, said the very idea of creating industry titans blessed by the state was antithetical to modern capitalism because it protected corporations that were inherently less competitive.

"I don't believe in national champions -- national champions by definition are those which by definition do not maximize profitability," Greenspan said at an investors conference in New York.

He said that the creation of United Company Russian Aluminum -- from RusAl, SUAL and the alumina assets of Glencore -- would indeed produce a giant aluminum company, but he observed that such giant companies do not tend to be innovators, especially if they are protected by the state.

The former chairman of the Federal Reserve also warned of the onset of Dutch disease, an economic malady that affects countries with natural resource wealth.

His remarks came in stark contrast to a largely upbeat assessment from Renaissance Capital CEO Stephen Jennings.

"Russia is also building national champions, in oil and gas, metals and mining, transportation, defense, aerospace, machinery and nuclear power," Jennings told the conference, sponsored by RenCap Securities. "It's building these industries in a different manner and by different means than it is done in the U.S. and Europe today, but ultimately with the same effect and purpose: governments supporting financially and politically industries they deem 'strategic.'"

Oil, gas and aluminum are classic 20th-century industries, and Greenspan said Gazprom would have done better to follow through with its plans to produce liquefied natural gas, a newer technology that would be more competitive in the 21st-century economy.

"Competitiveness will not come from the large companies -- it will come from the medium size," he said.

Greenspan said Russia's heady rate of GDP growth could help its economy resemble Western Europe's in the near future, as long as the Kremlin avoided certain missteps.

"If it weren't for this national champion issue, which I find very disturbing, ... it could close the gap on Western Europe very quickly," he said.

In response to an investor's question, Greenspan acknowledged that the governments of European countries and even the United States could be protective of certain large, successful industries that lie within their borders.

"It's the same malady, but I'm just fearful that Russia's got a deeper virus than the rest of us," Greenspan said. "The Russians are just doing it with a little more fervor."

Besides the national champions, Greenspan warned of the dangers of Dutch disease, in which a country with natural resource wealth experiences a sharp rise in the value of its local currency, strangling the competitiveness of other industries, especially manufacturing.

But he praised the work of his "friend," Finance Minister Alexei Kudrin, in keeping oil revenues flowing to foreign reserves and the stabilization fund, where they are effectively "sterilized" from having a damaging effect on other parts of the economy.

Besides Central Bank intervention in the currency market, Greenspan said the best defense against Dutch disease in the past had been a large, healthy economy diversified away from natural resources. "Russia is somewhere in the middle on this issue," he said.

Greenspan said Russia's economy continues to be hobbled by an underdeveloped banking system, partly as a result of the small role of banks during Soviet times.

In addition to a couple of large, state-controlled banks, Russia is filled with a "very large group of institutions which are called banks, but I'm not sure what they are."

The banking sector will benefit from the death of these financial institutions, as well as the growing presence of foreign banks in Russia, he said.

"They will spread 21st-century banking throughout the Russian system," Greenspan said of the foreign banks. "Remember, they operate under Russian law -- this is not a foreign invasion." Foreign participation in the financial sector has been a contentious point in Russia's negotiations to join the World Trade Organization.

In all, Greenspan struck a cautiously optimistic tone on the future of the Russian economy, assuming the people and their elected representatives eventually recognize the folly of establishing national champions.

"I trust that in the years ahead the Russian people will see that is the case and venture forth with the type of economy which they deserve, finally," he said.

The world's most modern plant - and it's in Siberia

Guardian Unlimited, UK - October 22, 2006

Simon Caulkin, The Observer

Siberia is huge, empty and inhospitable - a five-hour plane ride from Moscow in a battered 1970s Tupolev gets you no further than the wild central republic of Khakasia: population 600,000; average yearly temperature, zero Celcius. It seems an unlikely hotbed of new developments in a £30bn world industry.

Yet nothing better illustrates the changing of the world's industrial guard than the new Khakas aluminium smelter at Sayanogorsk, south of capital Abakan. Khakas, the first smelter built in Russia since 1985 and claimed to be the most technologically advanced in the world, is being built by Russians, using Russian technology, with Russian money. The £375m investment is just a starter: even before this month's merger announcement with smaller rival Sual, parent Rusal (for Russian Aluminium) had began a £8bn expansion and modernisation programme aiming to almost double production to 5 million tonnes by 2013.

At a stroke, the merger, which includes the raw materials assets of Swiss metals trader Glencore and will be known as United Company Rusal (UCR), achieves Rusal's aim of becoming the world's Number 1 producer, overtaking long-time North American leaders Alcoa and Alcan. Given the company's history, this is remarkable in itself. Only six years old, Rusal emerged as a joint venture put together by oligarchs Roman Abramovich and Oleg Deripaska out of the wreckage of the 'aluminium wars', a violent struggle for control of the industry in the mid-1990s. Its chief assets were four giant Soviet-era smelters whose size was offset by being run down, over-manned and an environmental nightmare. The captive workforce wasn't just disaffected - it was dangerously mutinous.

But it would be a mistake to dismiss the company's rise from nowhere as a triumph of dodgy finance and quantity over quality. 'Becoming number one is good, but it's all about quality,' says director of strategy and corporate development Pavel Ulianov. As bold as the company's growth goals, is its ambition to become Russia's best-managed company and an employer of choice. This means playing a canny game on at least two levels.

The first is strategic and geopolitical. The largest cost element (at 30 per cent) in aluminium production is energy - which is why, as competition for energy sources hots up, the industry's centre of gravity is shifting to the Middle East, Iceland and Siberia, which is blessed with clean and renewable hydropower. Energy will account for a third of UCR's investment spend. Also vital is a secure supply of raw materials - alumina for smelting and the bauxite from which that alumina is refined.

Increasingly, aluminium production requires global scale. As Deripaska noted, the estimated £15bn Rusal-Sual-Glencore deal creates 'a truly global company', with assets stretching from Guyana to Guinea by way of Australia and Europe, and substantially in energy as well as aluminium. In turn, that requires the company to raise its game in managing operations, and, particularly, people. 'I used to believe we needed to breed "Rusal people",' says HR director Victoria Petrova, part of a young top team that relishes the idea of creating a world-class Russian enterprise. 'Now I think diversity is more important.'

Alongside R&D and design capabilities, the group has set up a corporate university, professional 'academies' for functions such as HR and finance, and a medical institute. With 110,000 employees in 17 countries across five continents in the combined group, diversity now has a strong international element.

Just how far Rusal has come in international awareness is in evidence at the Sayaganorsk complex. On the walls of the spick-and-span plants are charts tracking production, quality and absence levels, while at the Khakas smelter, robots delicately stack aluminium ingots on pallets. Apparently at Deripaska's behest , Rusal invited sensei (teachers) from Toyota to advise on production techniques. It now boasts a 'Rusal Business System' along the lines of the famous Toyota Production System which, according to Petrova, is removing swathes of bureaucracy as well as identifying novel ways of boosting smelter productivity. Although this has doubled since 2000 it still lags behind the best international standards.

In other areas, however, the company remains unabashedly Russian. It is proud that, having sacked the original international contractors, it is building Khakas using its own engineering and construction resources. The advanced processing technology used at the site is also self-developed. It had to be - foreign rivals refused to license theirs.

Less welcome - and its most obvious Achilles heel - is another Russian speciality of the 1990s; less-than-transparent corporate governance and the potential for political influence. A flotation in London in the next two years - a condition of the merger - and Russian presidential elections in 2008 are tests that will be watched by investors and competitors alike. But assuming those hurdles are passed, have no doubts: it won't be how the cold-war warriors were expecting it, but the Russians are coming.

simon.caulkin@observer.co.uk

Russian Aluminum Could Become South African

Kommersant, Russia - Oct. 23, 2006

SUAL Holding President Brian Gilbertson has suggested attracting South African Anglo American to the holding established by SUAL, RUSAL and Glencore, Britain’s media reported. Should it ever happen, the stakes of RUSAL and SUAL in the new company would shed to 20 percent and 6.6 percent respectively. In RUSAL, they say no partners will appear in the following half a year, while the market analysts name Rio Tinto as the most probable investor for Anglo American.

According to The Times, SUAL Holding President and future BOD chairman of Russian Aluminum, Brian Gilbertson has proposed to other BOD members to consider probable consolidation with Anglo American. Russian Aluminum is being currently created based on the assets of RUSAL, SUAL and Swiss Glencore (the agreement of October 9).

But Anglo American’s capitalization ($68.7 billion according to LSE quotes) is more than two fold above the most optimistic forecasts for Russian Aluminum (between $25 billion and $30 billion). The consolidation will narrow RUSAL share in the united company from 66 percent to 20 percent, SUAL will go down from 22 percent to 6.68 percent, Glencore will have 3.6 percent instead of 12 percent, while more than 70 percent will go to owners of Anglo American.

SUAL declined to comment on Gilbertson’s plans related to Anglo American. In RUSAL they appeared very much surprised by the news, saying Gilbertson couldn’t have recommended anything to the BOD, as no BOD has been established yet. "The Board of Directors will appear only by completion of the merger deal, i.e. by April 1," the company’s representatives explained.

So, Anglo American’s takeover by Russian Aluminum could be considered no earlier than in half a year. But Anglo American will probably find a strategic partner by that date. The candidates are Rio Tinto and Xtrata, the analysts speculate.

Cheaper gas key to WA smelter – Alcoa chief

The West Australian, Australia 25th October 2006

WA’s chances of hosting a multi-billion-dollar aluminium smelter in the next decade rest largely on its ability to guarantee long-term supplies of competitively priced gas, according to the head of Alcoa’s Australian business.

Throwing his weight publicly behind Premier Alan Carpenter’s domestic gas reservation policy, Alcoa Australia chief Wayne Osborn said yesterday energy supplies were the key to unlocking the potential benefits of building a smelter close to Alcoa’s massive WA alumina refineries.

"I think it (a smelter) is a desirable outcome for Western Australia — the day we can get an aluminium smelter here marks an opportunity to value add," he said after addressing the Minerals Council’s Sustainability and Development Conference in Perth.

"We could just export natural gas and bauxite, but we get much more value if we combine them together. Right now we combine gas and bauxite to produce alumina which gives Australia a better return. That’s the message for Canberra: not just WA, but Australia will get a better return overall.

"So the more we can use our natural gas for our own economic development in this country, I think we will be much better off. It’s perhaps a great example of why you would work to create more value-adding by ensuring you’ve got the energy security to contemplate such projects."

Mr Osborn said though an Alcoa smelter in WA was still "a long way off", it might be a possibility "probably in a 10-year sort of time frame".

Asked whether Alcoa would consider direct investment in "upstream" gas assets to encourage further supplies for the domestic market, Mr Osborn said it was not impossible.

"The natural gas business is not our core business, but in smelting we have taken a small interest in energy assets where it’s appropriate," he said. "So it’s not something you would rule out, but it’s not something on the immediate agenda."

Mr Osborn said Alcoa’s funding support for the current expansion of the Dampier-Bunbury gas pipeline had "helped break the deadlock" which had been stalling the much needed upgrade.

In the near term, however, Alcoa was focused on plans for a $1.5 billion expansion of its controversial Wagerup refinery that would make it the world’s biggest.

The WA Government granted environmental approvals for the massive development last month, but Mr Osborn said Alcoa would not be in a position to commit to the project for at least 18 months.

With the resources industry generally under enormous pressure from chronic shortages of skilled workers and rising equipment and materials costs, Alcoa is now undertaking advanced design and engineering studies to counter any blowout.

"I’m very confident about Wagerup, even given the issues we’ve got around at the moment," he said.

"It’s going to take about 18 months to get through the engineering requirements to get it down to detailed level . . . but it’s still a very good project for us and I’m confident we will get it up."

Mr Osborn believed Alcoa would be able to attract sufficient workers to undertake the expansion.

John Phaceas

Alcan reviewing succession options for departing president of its Primary Metal group - Successor to be named by year-end

CNW Telbec (Communiqués de presse), Canada Oct 24, 2006

MONTREAL, Oct. 24 /CNW Telbec/ - Alcan Inc. announced today that it is

reviewing succession options related to the departure of Cynthia Carroll,

currently Senior Vice President of Alcan Inc. and President of the Company's

Primary Metal business group. Effective mid-January 2007, Ms. Carroll will be

joining Anglo American plc to become Chief Executive Officer. A successor is

expected to be announced by year-end and the business will continue reporting

to her in the interim.

"Cynthia has played a key role in Alcan's growth and development as well

as its merger integration activities," said Dick Evans, President and Chief

Executive Officer of Alcan Inc. "On behalf of the entire Alcan family, I wish

to thank her for her contribution and wish her every success in her new role,"

he added.

"Alcan has built substantial depth and management capability in its team

and as such, we expect to be in a position to name a successor before Cynthia

departs at year-end. I have every confidence that the strong team in place

will continue to deliver on our attractive pipeline of primary metal growth

projects," Evans added.

Spokane River cleanup begins near Upriver Dam

KXLY, WA Tuesday, October 24th, 2006 06:06:56 PM

Dave Meany / News4 Reporter

SPOKANE -- A major step in the cleanup of toxic pollution in the Spokane River is underway as crews are now starting work on a half-mile stretch of contaminated sediment behind Upriver Dam.

Equipment moved in Tuesday near the Minnehaha climbing rocks in Spokane Valley, just one step in the process to reduce years of toxic buildup in the river.

Years of pollution have left chemical compounds embedded in the mud contaminating fish and putting human health at risk but cleanup efforts are finally under way.

The machinery will soon be moved out onto the river by barge where crews will begin a process of "capping" the PCBs that lie below. The capping will consist of three layers starting with coal.

"Which is the reactive portion of the cap, and that will be absorbing the PCBs to cut off the source to the river," Zach Hedgpeth of the Department of Ecology said.

The coal will then be covered with sand and gravel to guard against erosion. The process will cover a half-mile long trench of the river from Upriver Dam back up to where the river turns.

Mike LaScuola of the Regional Health District says the toxic threat is the main reason behind the fish consumption advisory for this stretch of river and he hopes the cleanup will change things.

"We're encouraged by the fact that recent testing is starting to show some reduction," LaScuola said. "Hopefully with this project will see a very good reduction and we'll be able to amend or lift the advisory."

This project won't completely erase all of the transgressions of the past but experts say it's a start.

"It's one step," Hedgpeth said. "I mean there's several, I mean this one's important but it's not going to be the end-all-be-all answer … it's just the first step."

DOE reports most of the PCBs came from Kaiser Aluminum which agreed to help Avista come up with the $2 Million to complete this project. Cleanup which will take about six weeks and will be followed by a second phase which includes removing sediment upriver in the Donkey Island Channel.

Carroll leaving Alcan to become CEO of Anglo American PLC

National Post, Canada Tuesday, October 24, 2006

Cynthia Carroll, currently President Alcan Primary Metal Group, will join the Anglo American Board in mid January 2007 and will succeed Tony Trahar as Chief Executive Officer on 1 March. Tony Trahar will step down from the board at the Annual General Meeting in April.

MONTREAL -- Top Alcan Inc. executive Cynthia Carroll is leaving to become CEO of mining and metals giant Anglo American plc, establishing her as one of the industry’s leading executives and its most powerful woman.

Ms. Carroll, president of Alcan’s primary metals group, is leaving the Montreal-based firm after 18 years. The company she will join in March is one of the world’s top three mining firms, earning US$3.7-billion profit on revenue of US$34.5-billion in 2005.

Ms. Carroll, 49, departs a company known as one of the most progressive in the sector in terms of female advancement — three of Alcan’s four operating unit presidents are women — to join one of the most insular. She becomes the first outsider, woman and non-South African to head Anglo American.

Ms. Carroll replaces Tony Trahar, who will leave in 2007 after seven years at the top.

Analysts greeted the news of Ms. Carroll’s appointment with hesitation and surprise. She is not well known in London, where the top mining companies are based, UBS analyst Paul Galloway said in a note. But he added Ms. Carroll may shake up a staid firm that has underperformed rivals Rio Tinto and BHP Billiton recently.

"We believe she can look at Anglo without preconceived ideas or any internal preconception" which may allow her to make hard decisions and act less conservatively, he said. "The question is, does she have the experience."

Anglo spokesman Nick von Schirnding said Ms. Carroll was the unanimous first choice of the board, meeting its three criteria: a track record in operations with a heavy industrial firm, the ability to manage transformation and experience dealing with politicians, shareholders and other stakeholders.

Ms. Carroll’s work in Alcan projects in Cameroon, Oman, and South Africa "were very positives attributes the board thought she brought," he said.

One question rippling through the industry yesterday was whether Ms. Carroll could someday lead her new employer to take a run at Alcan. The aluminum firm – a leading consolidator in its field over the past decade – is now one of the top-performing and lowest-cost operators, thanks in part to Ms. Carroll’s work driving costs out of the primary metals group, which accounted for 34% of Alcan revenue and 55% of its profits last year.

But it is small fry by market value compared with the leading metals and mining firms and has thus been named as possible prey if the industry further consolidates. One analyst, who asked not to be named, said the two firms would make an ideal fit, since Anglo is looking to expand, but has no aluminum operations.

Anglo, based in London, was founded by German entrepreneur Ernest Oppenheimer 89 years ago to exploit Johannesburg’s gold deposits. It is the world’s leading producer of platinum and, through its 45% stake in De Beers, the leading diamond producer. It is also one of the top private coal miners.

In the past decade it has sold holdings in such areas as brewing, media and finance to focus on mining and metals, while expanding outside South Africa.

The firm has undergone further change in the past year, selling down its stake in gold producer Anglo Gold Ashanti and planning the spin off its paper and packaging unit.

"The restructuring of the portfolio is well-launched and on track to be delivered," Ms. Carroll said in an interview posted on Anglo’s Web site. "I’m looking forward to understanding what further potential there is within our asset base, and how we can continue to grow that."

The Pennsylvania-born Ms. Carroll, a mother of four children under 13, worked for eight years as a petroleum geologist with Amoco Production Co. in the 1980s before earning an MBA from Harvard University in 1989. The summer before graduation she worked as a business analyst at Alcan, then joined the company full-time. She moved up the ranks and became president of the bauxite, alumina and specialty chemicals division in 1998. She moved to her current job in January 2002.

In the past four years she has helped drive down costs in her division, which oversees 21 smelters around the world.

"Cynthia has played a key role in Alcan’s growth and development as well as its merger integration activities," said Alcan chief executive Dick Evans in a release. He wished her "every success in her new role,"

Ms. Carroll is one of several women this year to be named CEOs of major Indra Nooyi at PepsiCo, Irene Rosenfeld and Kraft Foods and Pat Woertz with agriculture giant Archer Daniels Midland.

But recruitment specialists said there are still too few females at the top of the corporate world.

"It’s really hard to call this a trend," said Deborah Gillis, executive director of Catalyst Canada, a research and advisory firm specializing in advancement of women in business, agreed.

Ms. Gillis pointed to a 2005 Catalyst survey that found 3.8% of the heads of FP500 companies in Canada were women. In the US, 2% of Fortune 500 CEOs are women, she said. "We’ve got a long way to go," Ms. Gillis said. "The notion the glass ceiling has been shattered is clearly a myth."

ssilcoff@nationalpost.com

Canada: Alcan may sell Dutch smelter

Ottawa Citizen (subscription), Canada 24 Oct, 2006

Alcan Inc., the world's second-largest aluminum producer, said it may sell its 85-per-cent stake in a Dutch smelter after two years of negotiations failed to result in cheaper supplies of electricity. The Pechiney Nederland unit will conduct a "strategic review," including the potential sale of the Vlissingen aluminum smelter, Montreal-based Alcan said yesterday

Cheaper gas key to WA smelter – Alcoa chief

The West Australian, Australia 25th October 2006

WA’s chances of hosting a multi-billion-dollar aluminium smelter in the next decade rest largely on its ability to guarantee long-term supplies of competitively priced gas, according to the head of Alcoa’s Australian business.

Throwing his weight publicly behind Premier Alan Carpenter’s domestic gas reservation policy, Alcoa Australia chief Wayne Osborn said yesterday energy supplies were the key to unlocking the potential benefits of building a smelter close to Alcoa’s massive WA alumina refineries.

"I think it (a smelter) is a desirable outcome for Western Australia — the day we can get an aluminium smelter here marks an opportunity to value add," he said after addressing the Minerals Council’s Sustainability and Development Conference in Perth.

"We could just export natural gas and bauxite, but we get much more value if we combine them together. Right now we combine gas and bauxite to produce alumina which gives Australia a better return. That’s the message for Canberra: not just WA, but Australia will get a better return overall.

"So the more we can use our natural gas for our own economic development in this country, I think we will be much better off. It’s perhaps a great example of why you would work to create more value-adding by ensuring you’ve got the energy security to contemplate such projects."

Mr Osborn said though an Alcoa smelter in WA was still "a long way off", it might be a possibility "probably in a 10-year sort of time frame".

Asked whether Alcoa would consider direct investment in "upstream" gas assets to encourage further supplies for the domestic market, Mr Osborn said it was not impossible.

"The natural gas business is not our core business, but in smelting we have taken a small interest in energy assets where it’s appropriate," he said. "So it’s not something you would rule out, but it’s not something on the immediate agenda."

Mr Osborn said Alcoa’s funding support for the current expansion of the Dampier-Bunbury gas pipeline had "helped break the deadlock" which had been stalling the much needed upgrade.

In the near term, however, Alcoa was focused on plans for a $1.5 billion expansion of its controversial Wagerup refinery that would make it the world’s biggest.

The WA Government granted environmental approvals for the massive development last month, but Mr Osborn said Alcoa would not be in a position to commit to the project for at least 18 months.

With the resources industry generally under enormous pressure from chronic shortages of skilled workers and rising equipment and materials costs, Alcoa is now undertaking advanced design and engineering studies to counter any blowout.

"I’m very confident about Wagerup, even given the issues we’ve got around at the moment," he said.

"It’s going to take about 18 months to get through the engineering requirements to get it down to detailed level . . . but it’s still a very good project for us and I’m confident we will get it up."

Mr Osborn believed Alcoa would be able to attract sufficient workers to undertake the expansion.

John Phaceas

Alcan reviewing succession options for departing president of its Primary Metal group - Successor to be named by year-end

CNW Telbec (Communiqués de presse), Canada Oct 24, 2006

MONTREAL, Oct. 24 /CNW Telbec/ - Alcan Inc. announced today that it is

reviewing succession options related to the departure of Cynthia Carroll,

currently Senior Vice President of Alcan Inc. and President of the Company's

Primary Metal business group. Effective mid-January 2007, Ms. Carroll will be

joining Anglo American plc to become Chief Executive Officer. A successor is

expected to be announced by year-end and the business will continue reporting

to her in the interim.

"Cynthia has played a key role in Alcan's growth and development as well

as its merger integration activities," said Dick Evans, President and Chief

Executive Officer of Alcan Inc. "On behalf of the entire Alcan family, I wish

to thank her for her contribution and wish her every success in her new role,"

he added.

"Alcan has built substantial depth and management capability in its team

and as such, we expect to be in a position to name a successor before Cynthia

departs at year-end. I have every confidence that the strong team in place

will continue to deliver on our attractive pipeline of primary metal growth

projects," Evans added.

Spokane River cleanup begins near Upriver Dam

KXLY, WA Tuesday, October 24th, 2006 06:06:56 PM

Dave Meany / News4 Reporter

SPOKANE -- A major step in the cleanup of toxic pollution in the Spokane River is underway as crews are now starting work on a half-mile stretch of contaminated sediment behind Upriver Dam.

Equipment moved in Tuesday near the Minnehaha climbing rocks in Spokane Valley, just one step in the process to reduce years of toxic buildup in the river.

Years of pollution have left chemical compounds embedded in the mud contaminating fish and putting human health at risk but cleanup efforts are finally under way.

The machinery will soon be moved out onto the river by barge where crews will begin a process of "capping" the PCBs that lie below. The capping will consist of three layers starting with coal.

"Which is the reactive portion of the cap, and that will be absorbing the PCBs to cut off the source to the river," Zach Hedgpeth of the Department of Ecology said.

The coal will then be covered with sand and gravel to guard against erosion. The process will cover a half-mile long trench of the river from Upriver Dam back up to where the river turns.

Mike LaScuola of the Regional Health District says the toxic threat is the main reason behind the fish consumption advisory for this stretch of river and he hopes the cleanup will change things.

"We're encouraged by the fact that recent testing is starting to show some reduction," LaScuola said. "Hopefully with this project will see a very good reduction and we'll be able to amend or lift the advisory."

This project won't completely erase all of the transgressions of the past but experts say it's a start.

"It's one step," Hedgpeth said. "I mean there's several, I mean this one's important but it's not going to be the end-all-be-all answer … it's just the first step."

DOE reports most of the PCBs came from Kaiser Aluminum which agreed to help Avista come up with the $2 Million to complete this project. Cleanup which will take about six weeks and will be followed by a second phase which includes removing sediment upriver in the Donkey Island Channel.

Carroll leaving Alcan to become CEO of Anglo American PLC

National Post, Canada Tuesday, October 24, 2006

Cynthia Carroll, currently President Alcan Primary Metal Group, will join the Anglo American Board in mid January 2007 and will succeed Tony Trahar as Chief Executive Officer on 1 March. Tony Trahar will step down from the board at the Annual General Meeting in April.

MONTREAL -- Top Alcan Inc. executive Cynthia Carroll is leaving to become CEO of mining and metals giant Anglo American plc, establishing her as one of the industry’s leading executives and its most powerful woman.

Ms. Carroll, president of Alcan’s primary metals group, is leaving the Montreal-based firm after 18 years. The company she will join in March is one of the world’s top three mining firms, earning US$3.7-billion profit on revenue of US$34.5-billion in 2005.

Ms. Carroll, 49, departs a company known as one of the most progressive in the sector in terms of female advancement — three of Alcan’s four operating unit presidents are women — to join one of the most insular. She becomes the first outsider, woman and non-South African to head Anglo American.

Ms. Carroll replaces Tony Trahar, who will leave in 2007 after seven years at the top.

Analysts greeted the news of Ms. Carroll’s appointment with hesitation and surprise. She is not well known in London, where the top mining companies are based, UBS analyst Paul Galloway said in a note. But he added Ms. Carroll may shake up a staid firm that has underperformed rivals Rio Tinto and BHP Billiton recently.

"We believe she can look at Anglo without preconceived ideas or any internal preconception" which may allow her to make hard decisions and act less conservatively, he said. "The question is, does she have the experience."

Anglo spokesman Nick von Schirnding said Ms. Carroll was the unanimous first choice of the board, meeting its three criteria: a track record in operations with a heavy industrial firm, the ability to manage transformation and experience dealing with politicians, shareholders and other stakeholders.

Ms. Carroll’s work in Alcan projects in Cameroon, Oman, and South Africa "were very positives attributes the board thought she brought," he said.

One question rippling through the industry yesterday was whether Ms. Carroll could someday lead her new employer to take a run at Alcan. The aluminum firm – a leading consolidator in its field over the past decade – is now one of the top-performing and lowest-cost operators, thanks in part to Ms. Carroll’s work driving costs out of the primary metals group, which accounted for 34% of Alcan revenue and 55% of its profits last year.

But it is small fry by market value compared with the leading metals and mining firms and has thus been named as possible prey if the industry further consolidates. One analyst, who asked not to be named, said the two firms would make an ideal fit, since Anglo is looking to expand, but has no aluminum operations.

Anglo, based in London, was founded by German entrepreneur Ernest Oppenheimer 89 years ago to exploit Johannesburg’s gold deposits. It is the world’s leading producer of platinum and, through its 45% stake in De Beers, the leading diamond producer. It is also one of the top private coal miners.

In the past decade it has sold holdings in such areas as brewing, media and finance to focus on mining and metals, while expanding outside South Africa.

The firm has undergone further change in the past year, selling down its stake in gold producer Anglo Gold Ashanti and planning the spin off its paper and packaging unit.

"The restructuring of the portfolio is well-launched and on track to be delivered," Ms. Carroll said in an interview posted on Anglo’s Web site. "I’m looking forward to understanding what further potential there is within our asset base, and how we can continue to grow that."

The Pennsylvania-born Ms. Carroll, a mother of four children under 13, worked for eight years as a petroleum geologist with Amoco Production Co. in the 1980s before earning an MBA from Harvard University in 1989. The summer before graduation she worked as a business analyst at Alcan, then joined the company full-time. She moved up the ranks and became president of the bauxite, alumina and specialty chemicals division in 1998. She moved to her current job in January 2002.

In the past four years she has helped drive down costs in her division, which oversees 21 smelters around the world.

"Cynthia has played a key role in Alcan’s growth and development as well as its merger integration activities," said Alcan chief executive Dick Evans in a release. He wished her "every success in her new role,"

Ms. Carroll is one of several women this year to be named CEOs of major Indra Nooyi at PepsiCo, Irene Rosenfeld and Kraft Foods and Pat Woertz with agriculture giant Archer Daniels Midland.

But recruitment specialists said there are still too few females at the top of the corporate world.

"It’s really hard to call this a trend," said Deborah Gillis, executive director of Catalyst Canada, a research and advisory firm specializing in advancement of women in business, agreed.

Ms. Gillis pointed to a 2005 Catalyst survey that found 3.8% of the heads of FP500 companies in Canada were women. In the US, 2% of Fortune 500 CEOs are women, she said. "We’ve got a long way to go," Ms. Gillis said. "The notion the glass ceiling has been shattered is clearly a myth."

ssilcoff@nationalpost.com

Canada: Alcan may sell Dutch smelter

Ottawa Citizen (subscription), Canada 24 Oct, 2006

Alcan Inc., the world's second-largest aluminum producer, said it may sell its 85-per-cent stake in a Dutch smelter after two years of negotiations failed to result in cheaper supplies of electricity. The Pechiney Nederland unit will conduct a "strategic review," including the potential sale of the Vlissingen aluminum smelter, Montreal-based Alcan said yesterday

Cheaper gas key to WA smelter – Alcoa chief

The West Australian, Australia 25th October 2006

WA’s chances of hosting a multi-billion-dollar aluminium smelter in the next decade rest largely on its ability to guarantee long-term supplies of competitively priced gas, according to the head of Alcoa’s Australian business.

Throwing his weight publicly behind Premier Alan Carpenter’s domestic gas reservation policy, Alcoa Australia chief Wayne Osborn said yesterday energy supplies were the key to unlocking the potential benefits of building a smelter close to Alcoa’s massive WA alumina refineries.

"I think it (a smelter) is a desirable outcome for Western Australia — the day we can get an aluminium smelter here marks an opportunity to value add," he said after addressing the Minerals Council’s Sustainability and Development Conference in Perth.

"We could just export natural gas and bauxite, but we get much more value if we combine them together. Right now we combine gas and bauxite to produce alumina which gives Australia a better return. That’s the message for Canberra: not just WA, but Australia will get a better return overall.

"So the more we can use our natural gas for our own economic development in this country, I think we will be much better off. It’s perhaps a great example of why you would work to create more value-adding by ensuring you’ve got the energy security to contemplate such projects."

Mr Osborn said though an Alcoa smelter in WA was still "a long way off", it might be a possibility "probably in a 10-year sort of time frame".

Asked whether Alcoa would consider direct investment in "upstream" gas assets to encourage further supplies for the domestic market, Mr Osborn said it was not impossible.

"The natural gas business is not our core business, but in smelting we have taken a small interest in energy assets where it’s appropriate," he said. "So it’s not something you would rule out, but it’s not something on the immediate agenda."

Mr Osborn said Alcoa’s funding support for the current expansion of the Dampier-Bunbury gas pipeline had "helped break the deadlock" which had been stalling the much needed upgrade.

In the near term, however, Alcoa was focused on plans for a $1.5 billion expansion of its controversial Wagerup refinery that would make it the world’s biggest.

The WA Government granted environmental approvals for the massive development last month, but Mr Osborn said Alcoa would not be in a position to commit to the project for at least 18 months.

With the resources industry generally under enormous pressure from chronic shortages of skilled workers and rising equipment and materials costs, Alcoa is now undertaking advanced design and engineering studies to counter any blowout.

"I’m very confident about Wagerup, even given the issues we’ve got around at the moment," he said.

"It’s going to take about 18 months to get through the engineering requirements to get it down to detailed level . . . but it’s still a very good project for us and I’m confident we will get it up."

Mr Osborn believed Alcoa would be able to attract sufficient workers to undertake the expansion.

John Phaceas

Alcan reviewing succession options for departing president of its Primary Metal group - Successor to be named by year-end

CNW Telbec (Communiqués de presse), Canada Oct 24, 2006

MONTREAL, Oct. 24 /CNW Telbec/ - Alcan Inc. announced today that it is

reviewing succession options related to the departure of Cynthia Carroll,

currently Senior Vice President of Alcan Inc. and President of the Company's

Primary Metal business group. Effective mid-January 2007, Ms. Carroll will be

joining Anglo American plc to become Chief Executive Officer. A successor is

expected to be announced by year-end and the business will continue reporting

to her in the interim.

"Cynthia has played a key role in Alcan's growth and development as well

as its merger integration activities," said Dick Evans, President and Chief

Executive Officer of Alcan Inc. "On behalf of the entire Alcan family, I wish

to thank her for her contribution and wish her every success in her new role,"

he added.

"Alcan has built substantial depth and management capability in its team

and as such, we expect to be in a position to name a successor before Cynthia

departs at year-end. I have every confidence that the strong team in place

will continue to deliver on our attractive pipeline of primary metal growth

projects," Evans added.

Spokane River cleanup begins near Upriver Dam

KXLY, WA Tuesday, October 24th, 2006 06:06:56 PM

Dave Meany / News4 Reporter

SPOKANE -- A major step in the cleanup of toxic pollution in the Spokane River is underway as crews are now starting work on a half-mile stretch of contaminated sediment behind Upriver Dam.

Equipment moved in Tuesday near the Minnehaha climbing rocks in Spokane Valley, just one step in the process to reduce years of toxic buildup in the river.

Years of pollution have left chemical compounds embedded in the mud contaminating fish and putting human health at risk but cleanup efforts are finally under way.

The machinery will soon be moved out onto the river by barge where crews will begin a process of "capping" the PCBs that lie below. The capping will consist of three layers starting with coal.

"Which is the reactive portion of the cap, and that will be absorbing the PCBs to cut off the source to the river," Zach Hedgpeth of the Department of Ecology said.

The coal will then be covered with sand and gravel to guard against erosion. The process will cover a half-mile long trench of the river from Upriver Dam back up to where the river turns.

Mike LaScuola of the Regional Health District says the toxic threat is the main reason behind the fish consumption advisory for this stretch of river and he hopes the cleanup will change things.

"We're encouraged by the fact that recent testing is starting to show some reduction," LaScuola said. "Hopefully with this project will see a very good reduction and we'll be able to amend or lift the advisory."

This project won't completely erase all of the transgressions of the past but experts say it's a start.

"It's one step," Hedgpeth said. "I mean there's several, I mean this one's important but it's not going to be the end-all-be-all answer … it's just the first step."

DOE reports most of the PCBs came from Kaiser Aluminum which agreed to help Avista come up with the $2 Million to complete this project. Cleanup which will take about six weeks and will be followed by a second phase which includes removing sediment upriver in the Donkey Island Channel.

Carroll leaving Alcan to become CEO of Anglo American PLC

National Post, Canada Tuesday, October 24, 2006

Cynthia Carroll, currently President Alcan Primary Metal Group, will join the Anglo American Board in mid January 2007 and will succeed Tony Trahar as Chief Executive Officer on 1 March. Tony Trahar will step down from the board at the Annual General Meeting in April.

MONTREAL -- Top Alcan Inc. executive Cynthia Carroll is leaving to become CEO of mining and metals giant Anglo American plc, establishing her as one of the industry’s leading executives and its most powerful woman.

Ms. Carroll, president of Alcan’s primary metals group, is leaving the Montreal-based firm after 18 years. The company she will join in March is one of the world’s top three mining firms, earning US$3.7-billion profit on revenue of US$34.5-billion in 2005.

Ms. Carroll, 49, departs a company known as one of the most progressive in the sector in terms of female advancement — three of Alcan’s four operating unit presidents are women — to join one of the most insular. She becomes the first outsider, woman and non-South African to head Anglo American.

Ms. Carroll replaces Tony Trahar, who will leave in 2007 after seven years at the top.

Analysts greeted the news of Ms. Carroll’s appointment with hesitation and surprise. She is not well known in London, where the top mining companies are based, UBS analyst Paul Galloway said in a note. But he added Ms. Carroll may shake up a staid firm that has underperformed rivals Rio Tinto and BHP Billiton recently.

"We believe she can look at Anglo without preconceived ideas or any internal preconception" which may allow her to make hard decisions and act less conservatively, he said. "The question is, does she have the experience."

Anglo spokesman Nick von Schirnding said Ms. Carroll was the unanimous first choice of the board, meeting its three criteria: a track record in operations with a heavy industrial firm, the ability to manage transformation and experience dealing with politicians, shareholders and other stakeholders.

Ms. Carroll’s work in Alcan projects in Cameroon, Oman, and South Africa "were very positives attributes the board thought she brought," he said.

One question rippling through the industry yesterday was whether Ms. Carroll could someday lead her new employer to take a run at Alcan. The aluminum firm – a leading consolidator in its field over the past decade – is now one of the top-performing and lowest-cost operators, thanks in part to Ms. Carroll’s work driving costs out of the primary metals group, which accounted for 34% of Alcan revenue and 55% of its profits last year.

But it is small fry by market value compared with the leading metals and mining firms and has thus been named as possible prey if the industry further consolidates. One analyst, who asked not to be named, said the two firms would make an ideal fit, since Anglo is looking to expand, but has no aluminum operations.

Anglo, based in London, was founded by German entrepreneur Ernest Oppenheimer 89 years ago to exploit Johannesburg’s gold deposits. It is the world’s leading producer of platinum and, through its 45% stake in De Beers, the leading diamond producer. It is also one of the top private coal miners.

In the past decade it has sold holdings in such areas as brewing, media and finance to focus on mining and metals, while expanding outside South Africa.

The firm has undergone further change in the past year, selling down its stake in gold producer Anglo Gold Ashanti and planning the spin off its paper and packaging unit.

"The restructuring of the portfolio is well-launched and on track to be delivered," Ms. Carroll said in an interview posted on Anglo’s Web site. "I’m looking forward to understanding what further potential there is within our asset base, and how we can continue to grow that."

The Pennsylvania-born Ms. Carroll, a mother of four children under 13, worked for eight years as a petroleum geologist with Amoco Production Co. in the 1980s before earning an MBA from Harvard University in 1989. The summer before graduation she worked as a business analyst at Alcan, then joined the company full-time. She moved up the ranks and became president of the bauxite, alumina and specialty chemicals division in 1998. She moved to her current job in January 2002.

In the past four years she has helped drive down costs in her division, which oversees 21 smelters around the world.

"Cynthia has played a key role in Alcan’s growth and development as well as its merger integration activities," said Alcan chief executive Dick Evans in a release. He wished her "every success in her new role,"

Ms. Carroll is one of several women this year to be named CEOs of major Indra Nooyi at PepsiCo, Irene Rosenfeld and Kraft Foods and Pat Woertz with agriculture giant Archer Daniels Midland.

But recruitment specialists said there are still too few females at the top of the corporate world.

"It’s really hard to call this a trend," said Deborah Gillis, executive director of Catalyst Canada, a research and advisory firm specializing in advancement of women in business, agreed.

Ms. Gillis pointed to a 2005 Catalyst survey that found 3.8% of the heads of FP500 companies in Canada were women. In the US, 2% of Fortune 500 CEOs are women, she said. "We’ve got a long way to go," Ms. Gillis said. "The notion the glass ceiling has been shattered is clearly a myth."

ssilcoff@nationalpost.com

Canada: Alcan may sell Dutch smelter

Ottawa Citizen (subscription), Canada 24 Oct, 2006

Alcan Inc., the world's second-largest aluminum producer, said it may sell its 85-per-cent stake in a Dutch smelter after two years of negotiations failed to result in cheaper supplies of electricity. The Pechiney Nederland unit will conduct a "strategic review," including the potential sale of the Vlissingen aluminum smelter, Montreal-based Alcan said yesterday

Russian Aluminum Giant Reopens Modernized Yerevan Plant

Armenialiberty.org, Armenia Oct 26, 2006

By Ruben Meloyan

Russia’s number one aluminum manufacturer inaugurated on Thursday its newly modernized Armenian subsidiary, presenting it as the most advanced facility of its kind in Europe.

Top executives from the Russky Allyuminii (Rusal) group announced the completion of a two-year renovation of the Yerevan-based aluminum foil plant Armenal, saying that it has cost $80 million in capital investments and promising a sharp increase in its production levels.

"The plant will be manufacturing foil of the highest quality," Aleksandr Livshits, Rusal’s vice-chairman, said at a special ceremony attended by Prime Minister Andranik Markarian and other senior Armenian officials. "Almost all of the production will be exported, and Armenal will provide Armenia with more taxes, jobs and hard currency."

Armenal was founded as a Russian-Armenian joint venture in 2000 on the ashes of the Kanaker Aluminum Plant, an industrial giant which employed thousands of people in Soviet times. Rusal gained full ownership of the plant in December 2002 and seems to have breathed new life in it since then. It borrowed $50 million from a German bank and claims to have invested $30 million of its own resources to turn Armenal into what Livshits described as "the best aluminum foil plant in Europe."

Livshits said new state-of-the-art equipment supplied and installed there by a German engineering firm will enable Armenal to produce up to 25,000 tons of aluminum rolls and foil a year. The company’s aggregate output stood at just 5,500 tons and 9,000 tons in 2002 and 2003 respectively.

Livshits said the Russian group is now considering increasing its production capacity to 40,000 tons. He also promised lavish pay rises for more than a thousand people working at Armenal. "I have instructed the Armenal management to pay, pay and pay. The more, the better," he told them.

Markarian praised Rusal’s track record in Armenia, saying that it underscores the importance of foreign investment for the country’s economic development.

Rusal controls nearly 80 percent of aluminum production in Russia and ranks second worldwide in the sector. Its largest shareholder, billionaire Oleg Deripaska, is one Russia’s best-known "oligarchs" who hugely benefited from controversial privatization policies pursued by the administration of former President Boris Yeltsin during the 1990s. Livshits, for his part, used to be Yeltsin’s top economic adviser and at one point served as Russia’s finance minister.

Ministry says Jamalco expansion on track

Jamaica Observer, Jamaica Friday, October 27, 2006

.But JLP leader claims project in jeopardy

BY BALFORD HENRY Observer writer

A Ministry Paper tabled in the House of Representatives on Tuesday by the Ministry of Development has sought to give an assurance that the US$1.25 billion expansion of the Jamalco alumina plant in South East Clarendon is on track.

But Leader of the Opposition Bruce Golding has claimed that the project could be derailed by the failure of Jamaica and Trinidad and Tobago to agree on the price of Trinidadian Liquefied Natural Gas (LNG) for the power plant, and that the 3,000 jobs which have been projected could be in jeopardy.

Speaking on Sunday at the annual conference of the Jamaica Labour Party's South East Clarendon constituency at the Vere Technical High School, Golding said that while the preparatory work was near completion the major project is in jeopardy.

He said that the Ministry of Development, under which the bauxite alumina sector falls, has not said a word about the project, although that portion is near completion and people are already being laid off.

According to Golding, 40 people have already been laid off, "while the main part of the project, which will employ 3,000 people, is now in jeopardy".

"Nobody is telling you that the project is now wobbling and unless something is done very quickly, almost immediately, then that project could very well fall by the wayside. This is further evidence that the country is running on auto pilot. Nobody is in charge, nobody who understands how critical th project is to the whole of Jamaica," he claimed.

But Ministry Paper 81, tabled by the newly appointed Minister of Development Donald Buchanan in the House on Tuesday, said that facilitating the completion of the expansion of the refinery to 2.8 million tonnes per annum, at a cost of US$1.25 billion, and the construction of a natural gas plant at a cost of US$250 million was among the ministry's priorities for 2006/2007.

The Ministry Paper, which contained the refinery's corporate plan for the period, however, omitted capital costs for expenditure on the refinery expansion in the company's total capital costs for 2006/2007.

But it confirmed that while the US$1.25 billion cost of the expansion is to be shared between CAP and US aluminium giant, Alcoa, 50/50 owners of Jamalco, the US$250 million cost of the refinery would be borne totally by Alcoa, which will solely own the refinery on completion.

balfordh@jamaicaobserver.com

Aluminum Bahrain considers 45% output hike

Middle East North Africa Financial Network, Jordan - 28/10/2006

(MENAFN) An official said that aluminum Bahrain (Alba), one of the world's biggest smelters, is mulling plans to raise its output by up to 45 per cent to about 1.2 million tonnes, The Peninsula reported.

The official said that the plan, which envisages a new production line worth $1.7 billion, was provisional and needed to be approved by the company's board.

Output at Alba currently stands at 830,000 tonnes. The firm has previously said it was examining foreign expansion plans as part of a business strategy to be decided within six months.

In September 2005, Alba launched its fifth production line, raising its output capacity by 307,000 tonnes per year.

Alba is 77 percent owned by the Bahraini government, 20 percent by Saudi Arabia and three percent by the German group Breton Investments.

The Louise Armitstead Interview: The woman who shook the City

The Sunday Times October 29, 2006

There was huge surprise when Anglo American appointed Cynthia Carroll as chief executive. She has extensive experience, but is she the right person to restructure this most traditional mining giant?

I ALMOST expected to find a riot at the offices of Anglo American.

It was Tuesday morning, just four hours after the world’s third-largest mining company had announced its new chief executive — and the City was scandalised.

"It’s a woman," spluttered one analyst.

"They’ll never accept her," warned another. "Anglo is run by empire-builders at one end and bruising miners at the other. The appointment of a woman tea lady would be seen as too advanced by the first lot, and a distraction by the others."

I could find few in the City who had ever heard of Cynthia Carroll and yet, amazingly, gender wasn’t all that was wrong with her.

More outrage stemmed from the fact that Anglo’s executives have always been South African men and long-serving company veterans. As one insider said: "This American president of something called Alcan Primary Metal is demonstrably neither." Even Anglo’s share price dropped 36p in shock.

At the company’s Mayfair headquarters there was no evidence of unrest, but tension was high. When I eventually met her, I found Carroll, who is petite with fair hair, dressed in a pin-stripe trouser suit and pink scarf, slightly bemused but otherwise relaxed.

"It’s been an exciting morning. Now what can I tell you?" she said.

Okay. Let’s deal with it: how do you feel about becoming the first female head of a £36 billion mining company, only the third woman chief executive of a FTSE 100 company and Britain’s most senior woman executive — at one of the most traditional companies in the world? Carroll laughed and frantically waved her arms at me in mock horror.

"Actually I’ve been extremely impressed by the board and I’ve spent some time with Nicky Oppenheimer (the grandson of Anglo’s founder Sir Ernest Oppenheimer who is a 3% shareholder)," she said.

Then, suddenly serious, she added: "I’ve never had a problem in a male-dominated sector. Results speak for themselves.

"I’ve been at Alcan Aluminium for 18 years. I ran the packaging business, then moved to Ireland to be managing director of Aughinish Alumina, then I was president of Alcan Bauxite. For the past five years I’ve been chief executive of the core metals business, which is now 75% of the company and is a global business in 20 countries.

"When I took over 80% of the metals business was in Canada, now 50% of revenue is from around the world and no smelters are in the top-cost quartile. I’ve been to smelters and mines across the world, including China, Ghana, New Guinea, Australia, Brazil and Jamaica. Mining is not new to me."

From Carroll’s experience, it’s clear that her appointment can hardly be termed tokenism. Alcan, being a Canadian company, might not be well known in London, but its size and importance, and Carroll’s hand in growing it, are well recognised in the sector.

She is not just a business manager but has had years of academic and practical experience in the sector. After growing up in Philadelphia, her interest was sparked by falling into geology classes accidentally.

"Geology was a complete fluke," she said. "At college I had to do a science requirement. Someone said do geology, so I did and I was hooked. I get geology, I understand the language. It’s an exciting sector."

Her first job was as a petroleum geologist based in Denver, Colorado. "It was great fun — there were lots of helicopter rides and mountain climbing, searching the ground," she said. "I went on to oversee operations like drilling, but then I moved further off into the business side of things — putting deals together, that kind of thing."

Now her life is a roller-coaster ride of foreign travel either to new mines and smelters or to meet government officials. Carroll denies she is a workaholic: "We have four children — three girls and a boy, aged between 13 and 7. Of course, it can’t be all work."

Together with her husband, whose background is in finance and who works from home, Carroll is preparing to move from Quebec, where Alcan is based, to London to take up her new post.

"We’ll be over in January — and we’re really looking forward to some better weather," she said.

Carroll’s arrival, and then full assumption of chief-executive duties in March, will be the culmination of a process that started at the World Economic Forum’s annual get- together in Davos in January. There at a breakfast meeting, Carroll spotted a man sitting alone and went over. He turned out to be Sir Mark Moody-Stuart, chairman of Anglo, who was looking for a replacement for Tony Trahar, the retiring chief executive.

Moody-Stuart was clearly impressed. Last week he said: "We know she has the strength to do this job because she has been operating in a male-dominated industry for a long time."

Carroll’s easy-going character may charm investors but there is little doubt that a lot will be expected of her. Anglo American is still South Africa’s biggest company, but its flotation in London in 1999 highlighted the problems of its old-fashioned traditions and structure — which it has been struggling to sort out ever since.

The company was founded in 1917 when Oppenheimer persuaded Herbert Hoover, the American financier and future president, to invest in a South African goldmine. It has since grown into a sprawling conglomerate, operating in more than 60 countries.

The company employs 195,000 people, mostly in mines in some of the world’s most inhospitable places, including the Democratic Republic of Congo, Peru and Russia. This compares with a workforce of 32,000 at BHP Billiton and 28,000 at Rio Tinto.

Anglo still owns long-term stakes in some of the world’s biggest miners, including 41% of AngloGold Ashanti and 45% of De Beers, the diamond company also founded by Sir Ernest Oppenheimer. It has stakes in unrelated companies such as Tarmac, the British aggregates firm, and Mondi, the business paper and packaging firm.

Analysts have accused Anglo of not having a coherent strategy and being unresponsive to new trends in the commodities markets. Its share price has lagged behind rivals Rio Tinto and BHP Billiton, which have benefited from greater exposure to bulk commodities such as iron ore and coal and therefore to China’s economic boom.

Trahar, who started at Anglo as a graduate trainee in 1974 and who has been chief executive since 2000, last year bowed to investor criticism and announced a sweeping restructuring of the company.

He also engineered the demerger of Mondi, which is expected to be listed on the London Stock Exchange with a market value of about £5 billion.

Although the restructuring has helped Anglo’s share price rise by almost 40% over the past year, the company is still considered a takeover target.

Even as Carroll and I were speaking, City trading desks were buzzing with fresh rumours that Rusal, the Russian steel giant, was planning a takeover. Xstrata has also been named as a potential bidder while others have suggested that Anglo could merge with Rio Tinto.

Moody-Stuart admitted last week: "(Carroll) has a mandate to make the best use of shareholder resources. Whether we merge with someone, are acquired by someone, or acquire someone, is up to shareholders."

Even so, her appointment is seen as a statement of independence by the company. One analyst said: "Of course the board doesn’t want to be bought by someone else. It is putting its confidence and hope in Carroll to ensure Anglo refinds favour with its investors and a takeover doesn’t happen."

Last week the response from the market was mixed. As the share price dropped, analysts at Merrill Lynch said: "We believe this news could be a disappointment."

A note from Cazenove admitted: "Nobody was looking towards the aluminium majors as a potential source for the new chief executive," but added: "The company is clearly willing to embrace change and in our view a chief executive from outside without any internal ‘baggage’ but with relevant experience is a further move in the right direction."

Although Carroll will join Anglo in January, she won’t fully take over from Trahar until March and as such is reluctant to say anything about her vision for Anglo beyond doggedly supporting the current strategy.

"Times are changing and Anglo is changing with the times. The restructuring couldn’t be more impressive and I’ll be proud to be a part of this," she said.

"I like working in a team, having decision-making at every level and I love action. But I’m a great communicator. I’m a big believer in connecting with people in business. I like to get close to people."

But she is keen to show that her past experience at Alcan is relevant. "At Alcan we have transformed the business significantly. Just a few years ago, Alcan was largely based in Canada. Now it’s in 20 countries. It had very high costs when I joined. We lowered the costs, improved operations and reconfigured the business.

"The last five years from 2000, I’ve been running the metals part, which is core — it accounts for 75% of the business this year."

Last week experts said one of her biggest challenges would be to reforge Anglo’s close ties with the South African government. One banker said: "There is a feeling that relationship is not what it should be for what is essentially South Africa’s biggest company, so she needs to look closely at that."

Carroll said: "At Alcan we wanted to have a $2.7 billion (£1.4 billion) greenfield smelter project in Port Elizabeth. I worked with multiple ministers towards a sustainable business case for the future. I’m looking forward to working with them again.

"I have worked with governments around the world. Recently we transformed the business in Iceland. In Quebec we now have the biggest smelter in North America. Recently we did a $2.5 billion joint venture with the Omani and Abu Dhabi governments to provide electricity. And we own the most profitable aluminium smelter in China."

As I left, Carroll was off to Paris for a board meeting at Alcan. "They are pretty emotional," she said. "I was close to a lot of people there. They have a lot of questions for me. But I’m leaving a management team that is fully capable. This challenge is fantastic."

Vital statistics

Born: November 13, 1956

Marital status: married, with four children

School: Stewart County Day School, New Jersey

Universities: Kansas and Harvard Business School

First job: geologist, Amoco

Salary (at Anglo): £900,000 plus performance-related bonus

Homes: Montreal and a house on an island in the St Lawrence river

Car: Audi A4

Favourite book: The Power of One, by Bryce Courtenay

Favourite music: listening to my daughter play the piano

Favourite film: The Shawshank Redemption

Favourite gadget: Blackberry

Cynthia Carroll's Working Day

THE new chief executive of Anglo American says she rises at about 5.30am. Cynthia Carroll then either walks or takes a bus to the office. The last year at Alcan has, however, meant travel for at least 60% of her working days.

This week has seen the beginning of the transition to Anglo American — starting and finishing in Canada but with Britain, France, Germany and South Africa in the middle. The most significant part was a day trip to Johannesburg — Anglo’s historic heartland. That involved four interviews with the media, two telephone calls with government ministers, a meeting of some 400 employees and sessions with two investment analysts.

If not travelling, Carroll tries to have dinner with her family and goes to bed about 11pm. "I generally sleep well. I am an optimist — what’s done

is done and there is no point on dwelling on the past. I believe that, generally, problems can be solved or overcome."

Downtime

CARROLL got interested in finance and business at an early age, when she used to read articles in The Wall Street Journal brought home by her father, an investment banker.

As well as developing a precocious head for figures, she used to do a lot of needlework as a teenager and made many of her own clothes. Carroll has made Halloween costumes for her children.

Riding was another early interest – cross country and eventing – but she doesn’t get much opportunity to do that now.

"I have also played a lot of sport – hockey, soccer, tennis, swimming and these days golf, sailing and kayaking," said the new Anglo American boss. "We do the water sports as a family and like messing about in small boats during our holidays on the St Lawrence."

Her other hobbies include reading and music. "I really enjoy working with my children on the piano. They are all learning to play it," she said.

Trinidad Prime Minister hints at third aluminum smelter plant

Caribbean Net News, Cayman Islands Monday, October 30, 2006

by Stephen Cummings

Caribbean Net News Trinidad and Tobago Correspondent

Email: stephen@caribbeannetnews.com

PORT OF SPAIN, Trinidad: Along with protests in Trinidad about the dangers associated with smelter plants comes an announcement by Prime Minister, Patrick Manning, that a third smelter could be on the way.

On Saturday, the Prime Minister said there are other proposals to build a third plant in the country. He was speaking to a group at a meeting organised by the La Brea Sports Foundation, held at the Vessigny Secondary School in the South.

He said government would examine those proposals and if accepted and having met with the country's

Environmental Management Agency (EMA) requirements, it will be smelter number three.

The Prime Minister however did not name where the third plant could be.

He also dismissed claims by protesters that there were dangers associated with such projects, adding the EMA had increased its environmental requirements to ensure there would be no health risks or undue damage to the environment.

Over the months, residents of south Trinidad have been protesting the setting up smelters. This has also led to street protests. Many of the country's environmental groups have now galvanised themselves into one body saying they would not have any such project.

Many believe that, if the government were to set up any aluminum smelter plants, they would do untold damage to human and wildlife.

Head of the Trinidad and Tobago Civil Rights Association, former Attorney General Ramesh Lawrence, has also taken up the issue saying he will take the government to court and if possible all the way to the Privy Council in London to ensure the rights of citizens.

Protesters block streets of Guinea bauxite towns

Reuters AlertNet, UK 30 Oct 2006 17:28:16 GMT

By Saliou Samb

CONAKRY, Oct 30 (Reuters) - Protesters blocked streets in two bauxite industry towns in Guinea on Monday, accusing authorities in the West African state of failing to use funds to improve roads and living conditions, witnesses said.

The demonstrators, many of them women, used tyres, blocks of wood and pieces of iron to erect barricades in Fria and Kamsar, where some of the country's main bauxite and alumina facilities are located.

Guinea has about a third of the world's bauxite and produced some 19.2 million tonnes in 2005. Bauxite is processed into alumina, which is in turn smelted into aluminium.

There was no immediate word on whether the protests had disrupted industrial production in the two towns.

A senior employee of the Alumina Company of Guinea, run by Russia's Rouski Alumini (RUSAL), said he had been forced to walk to work.

"Access routes have been blocked by people unhappy about the state of the road to Fria," the source, who asked not to be named, told Reuters. He added local officials were trying to clear the blocked streets.

Fria is located around 160 km (100 miles) north of the capital Conakry.

Despite its mineral riches, Guinea remains mired in poverty and angry citizens have staged a number of strikes and riots this year to protest against poor living conditions.

The instability has been compounded by the weak health of President Lansana Conte, an ageing, reclusive diabetic. Many fear that his sudden death or removal from power could throw the country into chaos.

In the bauxite port of Kamsar, 300 km (185 miles) northwest of Conakry, most of the protesters who blocked streets were women, witnesses said.

"They are going about town with red banners to show their anger. Everything is blocked," one worker at the Compagnie des Bauxites de Guinea (CBG) plant in Kamsar told Reuters, asking not to be named. The protests had stopped some employees from going to work, he added.

CBG is operated by Alcoa World Alumina <AA.N> through its Halco venture with Canada's Alcan <AL.TO> and privately owned Dadco. Halco owns 51 percent of CBG and Guinea's government holds the remaining stake.

Alcan sees decision soon on South Africa smelter

Reuters Tue Oct 31, 2006 11:59am ET

MONTREAL, Oct 31 (Reuters) - Alcan Inc. (AL.TO: Quote, Profile, Research) (AL.N: Quote, Profile, Research) said on Tuesday it expects to be able to announce soon that it will proceed with a $2 billion-plus plan to build a new aluminum smelter in South Africa.

Dick Evans, Alcan's president and chief executive, said the Canadian company was in final negotiations with local utility Eskom on a power contract for the proposed 660,000-tonne Coega smelter.

"I think it's going to happen in the fourth quarter. We're down to the final straws with Eskom," he told analysts during a conference call on Alcan's third-quarter results.

If approved, Alcan, the world's second-largest maker of primary aluminum, would build the smelter with partners and get coal-fired electricity for the plant through a 25-year contract with Eskom.