Alcoa and the government of Québec have reached an agreement whereby Hydro-Québec will renew Alcoa’s power supply contracts for its Becancour and Deschambault smelters until 2030 and for its Baie-Comeau smelter through 2036. The Alcoa announcement, dated February 25, stated that the agreement enables Alcoa to proceed with $250 million of planned investments at the smelters over the next five years to further improve their competitiveness.
As part of that investment, Alcoa will increase production of aluminum used for auto manufacturing and reduce production of commodity-grade aluminum at the Baie-Comeau casthouse to capture demand from automakers as they turn to aluminum for more fuel-efficient vehicles. According to automakers, use of aluminum body sheet in North American vehicles is expected to quadruple by 2015 and increase tenfold by 2025 from 2012 levels, Alcoa stated.
The previously planned modernization of the Baie-Comeau facility, through which Alcoa would have constructed a new potline to replace the two Söderberg potlines it closed last year, is not included in this agreement and will no longer be pursued.
“This agreement marks a new start for our Québec smelters, and we applaud Premier Pauline Marois and her team for their vision and commitment to Alcoa, our employees and community stakeholders,” Martin Brière, president of Alcoa Canada Global Primary Products, said, “Alcoa’s facilities in Québec can now concentrate on meeting growing global demand for aluminum and continuing to provide important economic benefits to the region.”