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August 30, 2007

Capital Improvement Projects Planned for Smelting and Rolled Products Areas at Alcoa's Tennessee Operations

ALCOA, Tenn.--Alcoa (NYSE:AA) announced today capital improvement projects totaling more than $100 million that have been approved for both the smelting and fabricating areas at Tennessee Operations. These projects are part of roughly $265 million capital investments planned over the next three years for the smelting and rolling facility and the Tapoco hydropower facilities. Latest expenditures approved include:
  • $80 million for upgrades in the Rolled Products area; and
  • $33.5 million for enhancements in Primary Products


Energy and Environmental Savings

Planned for the Can Reclamation facility is the installation of a new crusher and delacquering furnace and supporting building enclosures, utilities and environmental systems. These improvements will help increase capacity using state-of-the-art environmental and fuel efficient technology as well as support future flexibility to process other scrap types.

A new fume exhaust system planned for the 96-inch and 120-inch Hot Mills offers environmental and reliability improvements; and, in the preheat area, installation of two massive pusher preheat furnaces with 48-ingot capacity will provide both quality improvements and significant energy savings.

“Converting to pusher preheat furnace technology creates an advantage in terms of equipment reliability, product quality, conversion costs and market competitiveness,” said Malcolm Murphy, Alcoa Tennessee Location Manager.

The two 1,200 ton pusher preheat furnaces, the first of this kind in Alcoa and among the largest in the world, are more energy efficient and environmentally friendly, improve metal recovery, and require significantly less maintenance than the conventional box type furnace it will replace.

Maximizing Productivity while Lowering Operating Costs

Enhancements underway in the smelting area include purchase of a new pot control computer system, installation and replacement of smelting power system equipment, potroom roof replacement, and upgrade and modification of system ventilation and cover bucket filling station in the bath recycling facility.

“These upgrades will help sustain and maximize productivity in the smelter, ensure a reliable power system, lower system maintenance and operating costs as well as material handling efficiencies,” said Brett McBrayer, Tennessee Primary Products Location Manager.

All of these capital improvement projects will enable Tennessee Operations to continue as a competitive player in the worldwide aluminum industry. The tremendous efforts of our employees who made changes and improvements through the implementation of Alcoa Business System tools has earned us this reinvestment,” Murphy said.

The projects are expected to be completed over the next 12 to 18 months.

About Tennessee Operations

Alcoa’s Tennessee Operations is the world's largest producer of rolled aluminum can sheet for beverage cans and is based in Blount County, Tennessee. Tennessee Operations employs more than 1,800 at its smelting and fabrication plant in Blount County, its hydropower facilities, and its downtown Knoxville office.

About Alcoa

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 including flat-rolled products, hard alloy extrusions, and forgings, Alcoa also markets Alcoa® wheels, fastening systems, precision and investment castings, structures and building systems. The company has 116,000 employees in 44 countries and has been named one of the top most sustainable corporations in the world at the World Economic Forum in Davos, Switzerland. More information can be found at www.alcoa.com.