Rio Tinto plans shutdown of Anglesey smelter; cut 500 jobs

16 January 2009

Mining giant Rio Tinto would be shutting down its Anglesey aluminium smelter after being unable to find long-tem cheap electricity to run the plant.

Consequently, the largest single energy user in the UK has no option but to shut down at the cost of 500 jobs. The planned shutdown of the Welsh smelter will also add to Rio's job cut target of a further 14,000 and reduction in capital spending by $5 billion (£3.4 billion) on account of lower demand for metals.

The Anglesey smelter produces 145,000 tonnes of aluminium per annum, and is 51 per cent owned by Rio.

The remaining 49 per cent is held by Kaiser Aluminum. Rio has been talking to the government and electricity suppliers for securing a long-term agreement for cheap electricity to power the smelter ahead of the decommissioning of the Wylfa nuclear reactor nearby.

Rio announced a day ago that it had not succeeded in securing cheap power for the plan, and would therefore close down the smelter by September 2009. Being a power intensive industrial activity, aluminium smelting practically mandates the need for nuclear or hydro power.

The managing director of the Anglesey smelter David Bloor was quoted in the media as saying that operations at the smelter weere dependent on power from the nearby Wylfa nuclear power station, which is itself due for closure within the next few years.