Alcoa announces job cuts at Texas facility
U.S. aluminum maker Alcoa Inc (AA – News) said on Friday it has set dates for the layoff of about 300 employees at its Rockdale, Texas, aluminum smelter where the company has idled half of its production due to power supply issues.
In addition, Pittsburgh-based Alcoa said about 100 contract employees will also be laid-off.
The plant was partially shut in June because of ongoing supply issues with Luminant’s on-site power generating unit, which have exposed the plant to uneconomical power prices, Alcoa said in a statement.
Three of the plant’s six operating lines were idled as a result of the ongoing unit outages and local energy market costs increasing to as much as $2,000 to $4,000 per megawatt hour during peak hours, about 100 times the norm, Alcoa said.
The idled capacity accounts for about 120,000 tonnes of annual production.
Alcoa said it has negotiated with Luminant to try to resolve the power issues, but they have not been able to come to a satisfactory conclusion. The aluminum maker is seeking damages from Luminant through ongoing litigation.
In a statement, Luminant said Alcoa has made unrealistic demands and has insisted on dramatically below-market power prices.
Luminant is a subsidiary of Energy Future Holdings Corp, which was formerly known as TXU Corp.
In 2007 TXU Corp was taken private in a $32 billion buyout, led by Kohlberg Kravis Roberts & Co (KKR), Texas Pacific Group (TPG) and Goldman Sachs Capital Partners (GS – News).
Alcoa shares closed up 14 cents at $32.28 on the New York Stock Exchange.
Related posts:
- Earnings Reports Due From Sealy, Alcoa
Earnings season kicks off with Alcoa on Tuesday. The mining giant is expected to report that second-quarter profits declined to... - Alcoa Announces Cooperation Agreement with Vietnam on Development of Bauxite Mining and Alumina Refineries
Alcoa today announced the signing of a Cooperation Agreement with Vietnam’s premier minerals development company, Vietnam National Coal-Mineral Industries Group... - Alcoa and Chinese Rival Buy 12% Stake in Rio Tinto
The state-owned giant Aluminum Corporation of China and the Aluminum Corporation of America stunned analysts and investors Friday by buying...
Comments
Leave a Reply
