NEW YORK Alcoa Inc. and
Century Aluminum Co. continue to meet with power provider
Santee Cooper in an effort to hash out a new power contract for
the joint-venture aluminum smelter in Mount Holly, S.C.
"Were continuing to work
with Alcoa (and Century), certainly (as often) as necessary to
keep things moving," a Santee Cooper spokeswoman told
AMM. "They are a valued member of the corporate
community and we are working with them on this issue."
She declined to comment further
on negotiations or offer a timeline for when talks could
The existing power deal with
Santee CooperSouth Carolinas state-owned electric
and water utilityisnt due to expire until 2015, but
the parties have until June to either re-sign the existing
agreement or seek a better deal (AMM, Sept. 13).
On Centurys most recent
earnings conference call in late April, Michael Bless,
president and chief executive officer, said that all parties
had been discussing a short-term amendment to the power
contract and hope to conclude talks by the time the Monterey,
Calif.-based company releases its second-quarter results in
July (AMM, April 26).
Under the terms of the existing
agreement, the power to the plant is priced at rates fixed
under currently published schedules. Mount Holly has the right
to terminate the power contract early without penalty if London
Metal Exchange aluminum prices drop below certain negotiated
levels (AMM, Sept. 13.)
LME three-month aluminum closed
Tuesday at $2,063 per tonne, down 12.2 percent from a
year-to-date high of $2,349 per tonne on Feb. 28 and well under
the $2,200-per-tonne break-even point of most U.S. aluminum
"(Producers) with smelters in
the third quartile (like Mount Holly) are relentlessly pursuing
lower costs. They have to," an analyst told AMM.
"Its key to success when you make any commodity."
A Century spokeswoman confirmed
the power agreement terms are still in place, but declined to
comment further. Alcoa declined to comment.