Meridian Energy and New Zealand Aluminium Smelters (NZAS) – 79% owned by Rio Tinto - have shaken hands on a power bill dispute reportedly worth tens of millions of dollars.
NZAS has a low cost ‘take or pay' supply contract with Meridian for its Tiwai Point smelter. A transformer failure caused an outage in November 2008 that cut production – and power use – from the smelter for several months.
Global mining giant Rio Tinto has confirmed it is withdrawing from the New Zealand stock exchange as part of a global plan to reduce secondary listings.
The majority owner of the Tiwai Point aluminium smelter has informed the NZX that its listing will be cancelled at the end of trading on October 28, giving the required 10 working days notice.
Rio said the move was part of the reduced need for secondary listings and was little more than an “administrative procedure to reduce listing costs and streamline reporting processes”.
Global mining conglomerate Rio Tinto Alcan has confirmed it is in talks with Chinese aluminium giant Chinalco over a $US9 billion investment, although it is refusing to be drawn on exactly where that money would go.
Chinalco, an existing shareholder, is now in preliminary talks with the company, with the possibility of Chinalco acquiring minority interests in various operating businesses of the Rio Tinto group and also investing in convertible instruments.
The Bluff aluminium smelter has lost more than $12 million in production as a result of the power squeeze, The New Zealand Herald reported today.
The Rio Tinto Alcan smelter cut production by nearly 3000 tonnes a month in early May to avoid buying power on the spot market in addition to its long-term contract supply from Meridian Energy.
New Zealand Aluminium Smelters general manager Paul Hemburrow said the smelter was designed to run constantly and reducing production was costly and disruptive.