December 21, 2004

Alinta and Alcoa announce go-ahead for second cogeneration unit

Joint media statement by Alinta and Alcoa
 
Alinta Limited and Alcoa World Alumina Australia announced today the placing of the first order for the construction of a second 140 MW cogeneration unit to be located at Alcoa’s Pinjarra alumina refinery, 80 kilometres south of Perth.

Alinta has issued an initial notice to proceed with an engineering, procurement and construction (EPC) contract for the second unit.
 
The second cogeneration plant will be located immediately adjacent to Alinta’s first cogeneration unit currently under construction at Pinjarra and will be a replica of that unit.
 
Subject to finalisation of contracts and other approvals, construction of the second unit is scheduled to commence in January 2005, with electricity produced for sale by October 2006. 
 
About 70 per cent of the capacity of the second unit has been pre-sold to customers.
 
Alinta Chief Executive Mr Bob Browning said Alinta is rapidly becoming a major provider of electricity in Western Australia.
 
“Taking into account the two cogeneration plants and the Alinta Wind Farm – also currently under construction - within two years Alinta will be adding up to 370 MW of electricity into the south-west grid,” Mr Browning said.
 
“This represents much-needed private sector investment in independent generation capacity and means that scarce government resources can be allocated elsewhere. Continued reform in the West Australian electricity market will allow us to continue to expand our capability to deliver cleaner and cheaper power to consumers.”
 
Construction of the second unit is expected to cost approximately $165 million, of which about 70% is anticipated to be funded through a project finance facility with the balance from Alinta’s internal cash reserves.
 
As with the first unit, Alinta will own the second unit and take all electricity production for sale to third parties.  Alcoa will operate the unit and take all steam produced by the facility for use in its refinery.
 
Cogeneration is more than 80 per cent energy efficient, compared with 25-50 per cent for other power plants operating in WA. This means a year’s electricity from the cogeneration unit will produce 450,000 tonnes less greenhouse gas emissions than a similar sized coal fired plant.
 
Alinta’s first Pinjarra cogeneration unit is currently under construction and scheduled to be producing electricity by mid 2005.
 
Alinta has begun pre-selling electricity for the third cogeneration unit. A decision on the location of the third unit has not been finalised.
 
Contact:

Tony Robertson
Group Manager External Affairs
Alinta Limited
(08) 9486 3014 or 0419 867 230
 
Shaun Duffy
Investor Relations Manager
Alinta Limited
(08) 9486 3229 or 0404 094 384
 
Louise Boylen
Corporate Affairs
Alcoa World Alumina Australia
(08) 9316 5912 or 0404 800 417