Yarwun plant prepares for annual shutdown

AS Rio Tinto announces a 21% increase in first half underlying earnings to $5.1 billion, the Yarwun alumina site in Gladstone is busy going through one of its annual shutdowns.

First half alumina production was up 9%, reflecting stronger production at Yarwun and QAL which had both been affected by ex- tropical cyclone Oswald in the first half of 2013.

Production at Yarwun is expected to reach full capacity during the second half of 2015 as refinery design and construction challenges are progressively addressed.

The aluminium group's underlying earnings of $373 million were 74% higher than in 2013 first half, and aluminium production for 2014 first half was in line with the corresponding period of 2013.

The main drivers were growing momentum from the cost-reduction initiatives, a weaker Australian and Canadian dollar and a further rise in market and product premiums, with 61% of the group's primary metal sales sold as value-added product, generating a superior price.

This was achieved despite a 9% nine per cent decline in LME prices over the period which lowered earnings by $265 million.

Cash cost improvements lifted earnings by $162 million ($228 million pre-tax).

The savings included greater production efficiencies and lower prices of raw materials, lower functional costs and increased production from Queensland Alumina, Yarwun, AP60 and Alma which lowered the unit cash cost of production.

APN's monthly Central Queensland Industry magazine will take a behind-the-scenes look at the different processes and procedures that make Rio Tinto Alcan's Yarwun site tick.

Check out the next edition of CQ Industry, in The Observer on September 11.



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