REG - South32 Limited - Restart of Brazil Aluminium using Renewable Power

South32Announcement

06/01/2022 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220106:nRSF6232Xa&default-theme=true

RNS Number : 6232X  South32 Limited  06 January 2022

6 January 2022

South32 Limited

(Incorporated in Australia under the Corporations Act 2001 (Cth))

ACN 093 732 597)

ASX / LSE / JSE Share Code:  S32 ADR: SOUHY

ISIN:  AU000000S320

south32.net

 

RESTART OF BRAZIL ALUMINIUM USING RENEWABLE POWER

South32 Limited (ASX, LSE, JSE: S32; ADR: SOUHY) (South32) is pleased to
announce our decision to participate in a restart of the Alumar aluminium
smelter (Brazil Aluminium), together with our joint venture partner Alcoa
Corporation (Alcoa). First production is expected in the June 2022 quarter,
with full capacity from the smelter's three potlines of 447ktpa (100%) to be
achieved in the March 2023 quarter 1 . Once at full capacity our Group wide
annualised equity share of aluminium production is expected to lift by 16% (or
179kt) to 1,269kt 2 .

South32's 40% share of Brazil Aluminium will be powered by 100% cost efficient
renewable power, placing the smelter in the second quartile of the global
aluminium site cost curve 3 . With our energy requirements secured under long
term contracts, our alumina supply will be sourced from the co-located Brazil
Alumina refinery (36% South32 share), offering substantial efficiencies.

Brazil Aluminium has been on care and maintenance since 2015. We expect to
invest ~US$70M (40% South32 share) across FY22 and FY23 to support the
smelter's restart, including ~US$10M in capital expenditure.

South32 Chief Executive Officer, Graham Kerr said "We are excited to
participate in the restart of the Alumar smelter using 100% renewable power.
With the smelter benefitting from existing infrastructure, access to our own
supply of alumina and long-term green energy sources, we expect our investment
to deliver strong returns through the cycle.

"We see strong long-term market fundamentals for aluminium. By investing along
our existing alumina-aluminium value chain with the smelter's restart and the
expected increase to our shareholding in Mozal Aluminium, we are further
integrating our business and meaningfully increasing our share of metal
produced utilising green energy.

"With this decision we continue to make substantial progress in reshaping our
portfolio, increasing our exposure to the base metals required for the
critical transition to a low carbon future."

About Brazil Alumina and Brazil Aluminium

Brazil Alumina comprises South32's 14.8% interest in the Mineração Rio do
Norte (MRN) bauxite mine and our 36% interest in the Alumar alumina refinery.
Brazil Aluminium comprises our interest in the Alumar aluminium smelter (40%).
The MRN mine is located in the Trombetas region in the state of Pará, Brazil.
The Alumar alumina refinery and Alumar aluminium smelter are located at São
Luís in the state of Maranhão, Brazil.

 

 

About us

South32 is a globally diversified mining and metals company. Our purpose is to
make a difference by developing natural resources, improving people's lives
now and for generations to come. We are trusted by our owners and partners to
realise the potential of their resources. We produce bauxite, alumina,
aluminium, metallurgical coal, manganese, nickel, silver, lead and zinc at our
operations in Australia, Southern Africa and South America. With a focus on
growing our base metals exposure, we also have two development options in
North America and several partnerships with junior explorers around the world.

 

 

 Investor Relations
 Alex Volante                                    Tom Gallop

T          +61 8 9324 9029
T          +61 8 9324 9030

M        +61 403 328 408
M        +61 439 353 948

E          Alex.Volante@south32.net
E          Tom.Gallop@south32.net
 Media Relations
 Miles Godfrey                                   Jenny White

M        +61 415 325 906
T          +44 20 7798 1773

E          Miles.Godfrey@south32.net
M        +44 7900 046 758

E          Jenny.White@south32.net

 

Further information on South32 can be found at www.south32.net
(http://www.south32.net) .

Approved for release by Graham Kerr, Chief Executive Officer

JSE Sponsor:  UBS South Africa (Pty) Ltd

6 January 2022

 

 1  Production guidance for South32's 40% share is 5kt for FY22 and 140kt for
FY23.

 2  Based on FY23e production guidance for Hillside Aluminium and Mozal
Aluminium, with an increased ownership of 63.7% in the latter, our minimum
expected shareholding after we triggered our pre-emptive rights (refer to
market release "South32 to acquire up to an additional 25% of Mozal Aluminium"
dated 30 September 2021).

 3  Based on the CRU Aluminium Cost Model 2021.

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCFIFLRLEIRIIF