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December 30, 2004

Alcoa Transfers Juruti Development Rights to AWAC; Alcoa, Alumina Limited Clarify Mining, Refining in Brazil

NEW YORK--(BUSINESS WIRE)--Dec. 30, 2004--Alcoa (NYSE:AA) today announced it has entered into an agreement with Alumina Limited, its partner in Alcoa World Alumina and Chemicals ("AWAC") to transfer Alcoa's interests in the Juruti (Brazil) bauxite project to AWAC. Alumina Limited holds 40 percent of AWAC, and Alcoa holds the remaining 60 percent. In connection with the transfer of Juruti to AWAC, Alcoa and Alumina Limited also clarified AWAC's role in future bauxite mining and alumina refining projects in Brazil.

Under the Juruti agreement, Alcoa will transfer ownership of its bauxite development rights in the Juruti bauxite deposit to AWAC, and Alumina Limited will contribute US $40 million to AWAC. As a result of this agreement, Alcoa will realize a gain of approximately $37 million, or $0.04 per share in the fourth quarter of 2004.

The Juruti deposit is being considered for development to supply bauxite for a planned expansion of the Alumar refinery, and for potential supply to other AWAC and third party operations. Alcoa's board is expected to review this project and make a final investment decision late in 2005.

Alcoa and Alumina Limited confirmed that all new investments in bauxite and alumina refining in Brazil will be conducted through AWAC. The current operations of Alcoa Aluminio SA (Alcoa's wholly owned subsidiary) at the Alumar refinery and at Pocos de Caldas are the only exclusions. AWAC has a 54% interest in the previously announced study currently underway to expand the Alumar refinery by two million metric tons per year (mtpy). Alcoa's board also is expected to review this project and make a final investment decision late in 2005.

Alcoa is the world's leading producer and manager of primary aluminum, fabricated aluminum and alumina facilities, and is active in all major aspects of the industry. Alcoa serves the aerospace, automotive, packaging, building and construction, commercial transportation and industrial markets, bringing design, engineering, production and other capabilities of Alcoa's businesses to customers. In addition to aluminum products and components, Alcoa also markets consumer brands including Reynolds Wrap(R) foils and plastic wraps, Alcoa(R) wheels, and Baco(R) household wraps. Among its other businesses are vinyl siding, closures, fastening systems, precision castings, and electrical distribution systems for cars and trucks. The company has 120,000 employees in 43 countries and has been a member of the Dow Jones Industrial Average for 45 years and the Dow Jones Sustainability Indexes since 2001. More information can be found at www.alcoa.com.