Adds particulars on smelter, background Jan 14 (Reuters) -
Adds particulars on smelter, background
Jan 14 (Reuters) – World miner Rio Tinto RIO.AX stated on Thursday it had reached an settlement with electrical energy supplier Meridian Power MEL.NZ to permit its aluminium smelter in New Zealand to proceed operations till December 2024.
Rio Tinto had stated in July it will shut the New Zealand Aluminium Smelters enterprise because of excessive prices and a difficult market, placing over a thousand jobs on the road and dealing a blow to the nation’s high energy producers.
The choice to shut the smelter had disillusioned politicians and native energy companies because it got here when the economic system was crippled by the COVID-19 pandemic.
The miner stated that whereas talks have been ongoing with the federal government to handle the smelter’s excessive transmission prices, the take care of Meridian over energy costs would make the smelter economically viable.
The smelter, which employs hundreds of individuals within the Southland area, is a three way partnership between Rio and Japan’s Sumitomo Chemical Co 4005.T. Rio had an underlying lack of NZ$46 million ($33.1 million) in 2019 arising from it.
The settlement gives Rio Tinto, the New Zealand authorities, Meridian and the Southland group “extra time to plan for the longer term”, stated Alf Barrios, chief government officer of Rio Tinto Aluminium.
In separate statements, Meridian Power and fellow electrical energy supplier Contact Power CEN.NZ stated they welcomed the transfer to increase the smelter’s operations.
($1 = 1.3910 New Zealand {dollars})
(Reporting by Shashwat Awasthi in Bengaluru; Modifying by Amy Caren Daniel)
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