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Alcoa permanently closing remaining potlines at Massena East smelter; Sen. Griffo says plant modernization plans not affected

Posted 1/15/14

MASSENA -- Alcoa, St. Lawrence County’s largest private employer, today announced it will permanently close the remaining two potlines at its Massena East smelter in the first quarter of this year. …

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Alcoa permanently closing remaining potlines at Massena East smelter; Sen. Griffo says plant modernization plans not affected

Posted

MASSENA -- Alcoa, St. Lawrence County’s largest private employer, today announced it will permanently close the remaining two potlines at its Massena East smelter in the first quarter of this year.

The decision was made because the potlines are no longer competitive, company officials said in a prepared statement.

One of three potlines at the facility was permanently closed in August 2013. The closure will reduce Alcoa’s smelting capacity by 84,000 metric tons. The Massena West facility will continue to operate.

State Sen. Joseph Griffo, whose district includes Massena, says officials at Alcoa have told him their plan to close the remaining potlines won’t affect modernization or environmental remediation plans at their Massena sites.

"I’m disappointed to hear of Alcoa’s decision to close its remaining two potlines at the East Plant earlier than originally planned," Griffo said in a statement this afternoon.

"Alcoa leaders have assured me that this decision will not affect the company’s modernization plans or its Grasse River remediation project," the 47th District Republican from Rome said.

“We will be working with our unions, state, local and other stakeholders to minimize the impact of these changes,” said Bob Wilt, president of Alcoa Global Primary Products.

“We appreciate the support of the New York Power Authority and will work with them and others to ensure our continuing success at Massena West.”

"I will make sure the company fulfills its obligations to the New York Power Authority and the state,” said Griffo. “It is my hope that the company will consider its displaced workers first when the economy rebounds and the financial picture improves."

He urged the company to ease the transition for any workers who will be out of a job due to the shutdown.

"My hope is that the company takes advantage of state and federal programs to help its affected workers transition to new jobs within or outside the organization. My office stands ready to assist anyone who is left without adequate employment as a result of this decision," Griffo said.

Alcoa’s review of its primary metals operations is consistent with the Company’s 2016 goal of lowering its position on the world aluminum production cost curve to the 38th percentile, and the alumina cost curve to the 21st percentile.

In 2013, the Company met its goal of lowering its cost position in both aluminum smelting and alumina refining, having reached the 43rd percentile on the global aluminum cost curve, and 27th percentile on the global alumina cost curve. These shifts represent an 8 point movement and 3 point movement, respectively, since 2010.

Including the closure of the remaining two potlines at Massena East, Alcoa has announced closures or curtailments representing 361,000 metric tons of the 460,000 metric tons placed under review in May of 2013. Once the Massena East potline closure is complete, Alcoa will have total smelting operating capacity of 3,950,000 metric tons, with approximately 655,000 metric tons of capacity idle.

“We are taking decisive action to close the remaining potlines, given they are no longer competitive,” Wilt added. “We continue to reshape our commodity business to ensure it is positioned for long-term success.”

Total restructuring-related charges for the first quarter of 2014 associated with the above closure are expected to be between $60 and $70 million after-tax, or $.06 per share, of which approximately 40 percent is non-cash.