Rio Tinto has announced this morning that it has reached an agreement on a new electricity agreement with Meridian Energy that allows NZAS to continue operating the Tiwai Point aluminium smelter until December 31, 2024.

In a statement, the company says that while discussions with the New Zealand government are progressing in relation to their commitment to address the smelter’s high transmission costs, a new agreement has been reached with Meridian Energy in relation to power prices, making the smelter economically viable and competitive over the next four years. Its says the extension provides certainty to employees, the local community and customers while providing more time for all stakeholders to plan for the future.

Advertisement

Advertise on the Southland App

Rio Tinto Aluminium chief executive Alf Barrios said the extension also provides time for detailed closure studies to be completed and for NZAS to support the government and Southland community in planning for the future. Plans for eventual closure of the Tiwai Point smelter will include extensive stakeholder consultation, including within the Southland community and reflect the company’s robust closure and remediation standards.

“We are pleased to have reached an agreement with Meridian Energy that will enable the Tiwai Point smelter to continue producing some of the lowest carbon aluminium in the world. This agreement improves Tiwai Point’s competitive position and secures the extension of operation to December 2024. It also provides Rio Tinto, the New Zealand government, Meridian, and the Southland community more time to plan for the future and importantly gives our hard-working team at Tiwai and our customers the certainty they deserve.”

Advertisement

Advertise on the Southland App

In July 2020, Rio Tinto announced the conclusion of a strategic review of the smelter and a decision to wind down operations by August 202, citing high energy and transmission costs as the reason.

NZAS is a joint venture between Rio Tinto (79.36%) and Sumitomo Chemical Company Limited (20.64%). It employs around 1000 people directly and creates a further 1600 indirect jobs in Southland.