Alcoa Corporation (Alcoa) operates as a vertically integrated aluminum company consisting of bauxite mining, alumina refining, aluminum production (smelting and casting), and energy generation.
The company is active in all aspects of the upstream aluminum industry with bauxite mining, alumina refining, and aluminum smelting and casting. The company has direct and indirect ownership of 27 locations across nine countries on six continents. Alcoa smelts and casts aluminum in various shapes and siz...
Alcoa Corporation (Alcoa) operates as a vertically integrated aluminum company consisting of bauxite mining, alumina refining, aluminum production (smelting and casting), and energy generation.
The company is active in all aspects of the upstream aluminum industry with bauxite mining, alumina refining, and aluminum smelting and casting. The company has direct and indirect ownership of 27 locations across nine countries on six continents. Alcoa smelts and casts aluminum in various shapes and sizes for global customers, including developing and creating various alloy combinations for specific applications. Aluminum, as an element, is abundant in the earth’s crust, but a multi-step process is required to manufacture finished aluminum metal. Aluminum metal is produced by refining alumina oxide from bauxite into alumina, which is then smelted into aluminum and can be cast into many shapes and forms.
Segments
The company operates two segments, Alumina and Aluminum.
The Alumina segment primarily consists of the company’s bauxite mines and alumina refineries, which generally includes the mining of bauxite and other aluminous ores, as well as the refining, production, and sale of smelter grade and non-metallurgical alumina.
The Aluminum segment consists of the company’s aluminum smelting and casting operations along with most of the company’s energy production assets.
Business Strategy
The key elements of the company’s strategy include building a high-performance culture; disciplined capital allocation; and targeted growth.
Joint Ventures
Saudi Arabia Joint Venture
In December 2009, Alcoa entered a joint venture with the Saudi Arabian Mining Company (Ma’aden), which was formed by the government of Saudi Arabia to develop its mineral resources and create a fully integrated aluminum complex in Saudi Arabia. Ma’aden is listed on the Saudi Stock Exchange (Tadawul). The joint venture complex includes a bauxite mine with estimated capacity of 5 million dry metric tons per year; an alumina refinery with a capacity of 1.8 million metric tons per year (mtpy); and an aluminum smelter with a capacity of 804,000 mtpy.
The joint venture consists of two entities: the Ma’aden Bauxite and Alumina Company (MBAC) and the Ma’aden Alumina Company (MAC). Ma’aden owns a 74.9% interest in the joint venture. Alcoa owns a 25.1% interest in MAC, which holds the smelter; AWAC, which became wholly owned by Alcoa upon its completion of the Alumina Limited acquisition, holds a 25.1% interest in MBAC, which holds the mine and refinery. The refinery and smelter are located within the Ras Al Khair industrial zone on the east coast of Saudi Arabia.
ELYSIS
ELYSIS Limited Partnership (ELYSIS) is between wholly owned subsidiaries of Alcoa (48.235%) and Rio Tinto Alcan Inc. (Rio Tinto) (48.235%), respectively, and Investissement Quebec (3.53%), a company wholly owned by the Government of Quebec, Canada. The purpose of ELYSIS is to advance larger scale development and commercialization of its patent-protected technology that eliminates direct greenhouse gas emissions from the traditional aluminum smelting process and, instead, emits oxygen. Alcoa first developed the inert anode technology for the aluminum smelting process that served as the basis for the formation of ELYSIS in 2018.
Alcoa has the right to purchase up to 40 percent of the metal produced from the demonstration, allowing for Alcoa customers to benefit from ELYSIS’s carbon-free electrolytic process early in the technology development cycle.
Alcoa World Alumina and Chemicals (AWAC)
On August 1, 2024, Alcoa completed the acquisition of all the ordinary shares of Alumina Limited (Alumina Shares) through a wholly owned subsidiary, AAC Investments Australia 2 Pty Ltd. At acquisition, Alumina Limited, a company previously listed on the Australian Securities Exchange, held a 40% ownership interest in the AWAC joint venture.
AWAC Operations
AWAC entities’ assets include the following interests:
100% of the bauxite mining, alumina refining, and aluminum smelting operations of Alcoa’s affiliate, Alcoa of Australia Limited (AofA);
100% of the Juruti bauxite deposit and mine in Brazil;
45% interest in Halco (Mining) Inc., a bauxite consortium that owns a 51% interest in Compagnie des Bauxites de Guinee (CBG), a bauxite mine in Guinea;
39.96% interest in the São Luís refinery in Brazil;
55% interest in the Portland, Australia smelter that AWAC manages on behalf of the joint venture partners;
25.1% interest in the mine and refinery in Ras Al Khair, Saudi Arabia;
100% of the refinery and alumina-based chemicals assets at San Ciprián, Spain;
100% of Alcoa Steamship Company LLC, a company that procures ocean freight and commercial shipping services for Alcoa in the ordinary course of business;
100% of the refinery assets at the closed facility in Point Comfort, Texas, United States; and
100% interest in various assets formerly used for mining and refining in the Republic of Suriname (Suriname).
Others
The company is party to several other joint ventures and consortia.
The Aluminerie de Becancour Inc. (ABI) smelter is a joint venture between Alcoa and Rio Tinto located in Becancour, Quebec. Alcoa owns 74.95% of the joint venture through its 50% equity investment in Pechiney Reynolds Quebec, Inc., which owns a 50.1% share of the smelter, and two wholly owned Canadian subsidiaries, which own 49.9% of the smelter. Rio Tinto owns the remaining 25.05% interest in the joint venture through its 50% ownership in Pechiney Reynolds Quebec, Inc.
CBG is a joint venture between Boke Investment Company (51%) and the Government of Guinea (49%) for the operation of a bauxite mine in the Boke region of Guinea. Boke Investment Company is owned 100% by Halco (Mining) Inc.; Alcoa World Alumina LLC (AWA LLC) holds a 45% interest in Halco (Mining) Inc. AWA LLC is part of the AWAC group of companies, which became wholly owned by Alcoa upon its completion of the Alumina Limited acquisition.
Alumar is an unincorporated joint venture for the operation of a refinery, smelter, and casthouse in Brazil. The refinery is owned by AWAB (39.96%), Rio Tinto (10%), Alcoa Alumínio (14.04%), and South32 (36%). AWAB is part of the AWAC group of companies, which became wholly owned by Alcoa upon its completion of the Alumina Limited acquisition. With respect to Rio Tinto and South32, the named company or an affiliate thereof holds the interest. The smelter and casthouse are owned by Alcoa Alumínio (60%) and South32 (40%). Strathcona calciner is a joint venture between affiliates of Alcoa and Rio Tinto located in Alberta, Canada. Calcined coke is used as a raw material in aluminum smelting. The calciner is owned by Alcoa (39%) and Rio Tinto (61%).
Hydropower
Machadinho Hydro Power Plant (HPP) is a consortium located on the Pelotas River in southern Brazil in which the company has a 27.3% ownership interest through Alcoa Alumínio. The remaining ownership interests are held by unrelated third parties.
Barra Grande HPP is a joint venture located on the Pelotas River in southern Brazil in which the company has a 42.2% ownership interest through Alcoa Alumínio. The remaining ownership interests are held by unrelated third parties.
Estreito HPP is a consortium between Alcoa Alumínio, through Estreito Energia S.A. (25.5%) and unrelated third parties located on the Tocantins River, northern Brazil.
Serra do Facão HPP is a joint venture between Alcoa Alumínio (35%) and unrelated third parties located on the Sao Marcos River, central Brazil.
Manicouagan Power Limited Partnership (Manicouagan) is a joint venture between affiliates of Alcoa and Hydro-Quebec. Manicouagan owns and operates the 335-megawatt McCormick hydroelectric project, which is located on the Manicouagan River in the province of Quebec, Canada. Alcoa owns 40% of the joint venture.
Alumina
This segment consists of the company’s worldwide refining system, including the mining of bauxite, which is then refined into alumina, a compound of aluminum and oxygen that is the raw material used by smelters to produce aluminum metal. Bauxite is the principal raw material used to produce alumina and contains various aluminum hydroxide minerals, the most important of which are gibbsite and boehmite. Bauxite is refined into alumina using the Bayer process. The company obtains bauxite from its own resources, as well as through long-term and short-term contracts and mining leases. Tons of bauxite are reported on a zero-moisture basis in millions of dry metric tons (mdmt) unless otherwise stated.
Alcoa’s alumina sales are made to customers globally and are typically priced by reference to published spot market prices. The company produces smelter grade alumina and non-metallurgical grade alumina. The company’s largest customer for smelter grade alumina is its own aluminum smelters, which in 2024 accounted for approximately 32 percent of its total alumina shipments. A small portion of the alumina (non-metallurgical grade) is sold to third-party customers who process it into industrial chemical products. This segment also includes Alcoa's 25.1% share of MBAC. In September 2024, Alcoa entered into a share purchase and subscription agreement with Ma’aden, pursuant to which Alcoa agreed to sell its full ownership interest of 25.1% in the Saudi Arabia joint venture.
In 2024, Alcoa-operated mines, mines operated by partnerships in which Alcoa has equity interests, and bauxite offtake agreements supplied 85 percent of bauxite volume to Alcoa refineries and the remaining 15 percent was sold to third-party customers. Alcoa-operated mines produced 33.7 mdmt of bauxite and mines operated by partnerships produced 4.6 mdmt of bauxite on a proportional equity basis, for a total company bauxite production of 38.3 mdmt.
The company entered into several bauxite offtake agreements with South32 to provide bauxite supply for existing long-term supply contracts.
As of December 31, 2024, Alcoa had approximately 3,204,000 mtpy of idle capacity relative to total Alcoa consolidated capacity of 13,843,000 mtpy. The idle capacity includes: 2,190,000 mtpy at the Kwinana refinery, 800,000 mtpy at the San Ciprián refinery, and 214,000 mtpy at the Poços de Caldas facility.
In October 2024, the company completed its five-year strategic portfolio review to improve cost positioning, or curtail, close, or divest 4 million metric tons of refining capacity.
In June 2024, the company completed the full curtailment of the Kwinana refinery, as planned, which was announced in January 2024. As of March 2024, the refinery had approximately 780 employees and this number was reduced to approximately 250 through the fourth quarter of 2024. At that time, the employee number will be further reduced to approximately 50. In addition to the employees separating as a result of the curtailment, approximately 290 employees have terminated through the productivity program announced in the third quarter of 2023 or redeployed to other Alcoa operations.
In October 2024, Alcoa announced that the company is progressing toward entering a strategic partnership with IGNIS Equity Holdings, SL (IGNIS EQT), the majority shareholder in the IGNIS Group of Companies, a vertically integrated energy company based in Spain, to support the continued operation of the San Ciprián complex. Alcoa continues as the managing operator of the San Ciprián operations, with IGNIS EQT holding 25 percent ownership. In January 2025, the company, the Spanish national and Xunta regional governments, and IGNIS EQT signed a memorandum of understanding (MoU) that outlines a process for the parties to work cooperatively toward the common objective of improving the long-term outlook for the San Ciprián operations and focuses on the key areas of cooperation.
Aluminum
This segment consists of the company’s worldwide smelting and casthouse system and (ii) a portfolio of energy assets in Brazil, Canada, and the United States.
The smelting operations produce molten primary aluminum, which is then formed by the casting operations into either common alloy ingot (e.g., t-bar, sow, standard ingot) or into value-add ingot products (e.g., foundry, billet, rod, and slab). The energy assets supply power to external customers in Brazil and the United States, as well as internal customers in the Aluminum segment (Baie-Comeau (Canada) smelter and Warrick (Indiana) smelter) and, to a lesser extent, the Alumina segment. In September 2024, Alcoa entered into a share purchase and subscription agreement with Ma’aden.
Smelting and Casting Operations
Alcoa’s primary aluminum facilities and its global smelting capacity stated in metric tons per year (mtpy) as of December 31, 2024.
As of December 31, 2024, Alcoa had approximately 374,000 mtpy of idle smelting capacity relative to total Alcoa consolidated capacity of 2,645,000 mtpy. The idle capacity includes: 214,000 mtpy at the San Ciprián smelter, 54,000 mtpy at the Warrick smelter, 42,000 mtpy at the Alumar smelter, 33,000 mtpy at the Portland smelter, and 31,000 mtpy at the Lista smelter.
In the first quarter of 2024, the company completed the restart of 54,000 mtpy of capacity at the Warrick smelter (Indiana) that began in the fourth quarter of 2023.
In February 2023, under the terms of an amended viability agreement, Alcoa agreed to a phased restart of the smelter beginning in January 2024, to operate an initial complement of approximately 6 percent of total pots, to restart all pots by October 1, 2025, and to maintain 75 percent of the annual capacity of 228,000 mtpy from October 1, 2025, until the end of 2026. In March 2024, the company completed the restart of approximately 6 percent of total pots at the San Ciprián smelter. In October 2024, Alcoa announced that it is progressing toward entering a strategic partnership with IGNIS EQT to support the continued operation of the San Ciprián complex. Alcoa continues as the managing operator of the San Ciprián operations, with IGNIS EQT holding 25 percent ownership. In January 2025, the company, the Spanish national and Xunta regional governments, and IGNIS EQT signed an MoU that outlines a process for the parties to work cooperatively toward the common objective of improving the long-term outlook for the San Ciprián operations and focuses on the key areas of cooperation.
Energy Facilities and Sources
In 2024, energy comprised approximately 24 percent of the company’s total alumina refining production costs and electric power comprised approximately 22 percent of the company’s primary aluminum production costs.
In 2024, Alcoa generated approximately 10 percent of the power used at its smelters worldwide and generally purchased the remainder under long-term arrangements.
Alcoa Power Generating Inc., a subsidiary of the company, also owns certain Federal Energy Regulatory Commission (FERC)-regulated transmission assets in Indiana, Tennessee, New York, and Washington.
The Brazilian hydroelectric facilities produce energy which is transmitted across the national grid to Alcoa’s refineries in Brazil and the excess generation capacity is sold into the market.
Below is an overview of the company’s external energy for the company’s smelters and refineries.
North America
Electricity
Quebec, Canada
Alcoa’s smelter located in Baie-Comeau, Quebec, purchases approximately 25 percent of its electricity needs from Manicouagan Power Limited Partnership under an agreement that expires in February 2036. Otherwise, all electricity consumed by the three smelters in Quebec is purchased under contracts with Hydro-Quebec that expire on December 31, 2029. The Baie-Comeau contract has an automatic renewal through February 2036.
Massena, New York (Massena West)
The Massena West smelter in New York purchases power from the New York Power Authority (NYPA) pursuant to a contract between Alcoa and NYPA that expires in March 2026.
Natural Gas
Alcoa generally procures natural gas on a competitive bid basis from a variety of sources, including natural gas producers and independent gas marketers. Contract pricing for gas is typically based on a published industry index such as the New York Mercantile Exchange (NYMEX).
Australia
Portland
This smelter purchases power from the National Electricity Market (NEM) variable spot market in the state of Victoria and has fixed-for-floating swap contracts with AGL Hydro Partnership, Origin Energy Electricity Limited, and Alinta Energy CEA Trading Pty Ltd, for a combined 587 MW that expire on June 30, 2026.
In August 2023 and September 2024, the smelter entered nine-year fixed-for-floating swap contracts with AGL Hydro Partnership for a combined 587 MW effective July 1, 2026.
Each of these swap contracts manage exposure to the variable energy rates from the NEM spot market under long-term power purchase agreements, which include purchases of power from renewable energy sources.
Natural Gas
Western Australia
AofA uses gas to co-generate steam and electricity for its alumina refining processes at the Kwinana, Pinjarra, and Wagerup refineries, and to fuel the calcination furnaces at each site.
The Kwinana refinery was fully curtailed in June 2024, and the company is evaluating alternatives to resell, swap or redeploy the gas secured for the Kwinana refinery.
Prior to 2022, AofA secured a significant portion of gas supplies through 2032. On a combined basis, these gas supply arrangements cover approximately 90 percent of the Pinjarra and Wagerup refineries’ gas requirements through 2027, with decreasing percentages thereafter through 2032.
In 2024, AofA contracted for a portion of the additional gas supplies required starting in 2028 for a 10-year period.
Europe
Electricity
San Ciprián, Spain
Since March 2024, when Alcoa completed the restart of approximately 6 percent of capacity, the San Ciprián smelter has been exposed to the electricity spot market.
In 2022, Alcoa entered into two long-term power purchase agreements (PPAs) with renewable energy providers that are expected to supply up to 50 percent of the smelter's power needs at its full capacity. The supply of energy will continue to depend on the permitting and development of the windfarms included in the PPAs.
In October 2024, Alcoa announced that it is progressing toward entering a strategic partnership with IGNIS EQT to support the continued operation of the San Ciprián complex. Alcoa continues as the managing operator of the San Ciprián operations, with IGNIS EQT holding 25 percent ownership. In January 2025, the company, the Spanish national and Xunta regional governments, and IGNIS EQT signed an MoU that outlines a process for the parties to work cooperatively toward the common objective of improving the long-term outlook for the San Ciprián operations and focuses on the key areas of cooperation.
Mosjøen, Norway
Alcoa has several long-term power purchase agreements securing approximately 80 percent of the necessary power for the smelter through 2035. The remaining power at the smelter is purchased at spot rates.
Lista, Norway
Alcoa had several power purchase agreements securing approximately 90 percent of the necessary power for the smelter through 2024 and has a power purchase agreement securing approximately 80 percent of the necessary power for the smelter for 2025 through 2027. The remaining power at the smelter is purchased at spot rates.
Financial compensation of the indirect carbon emissions costs passed through in the electricity bill is received in accordance with European Union (EU) Commission Guidelines and the Norwegian compensation regime. Beginning in 2024, 40 percent of the compensation is conditional on decarbonization investment by Alcoa in Norway.
Iceland
Landsvirkjun, the Icelandic national power company, supplies competitively priced electricity from a hydroelectric facility to the smelter under a 40-year power contract, which expires in 2047 with a price renegotiation effective from 2028.
Natural Gas
Spain
The San Ciprián refinery has been operating at 50 percent of its capacity since the third quarter of 2022.
The San Ciprián refinery has access to an adequate supply at Spanish (PVB) spot gas rates.
South America
Electricity
Alumar
The Alumar smelter was operating at 84 percent of the site’s total annual capacity of 268,000 mtpy (Alcoa share) as of December 31, 2024, following the restart that was announced in September 2021.
The Alumar smelter purchases power under several long-term power purchase agreements that expire in 2038. Long-term power secured is from renewable sources.
Competition
Alumina
The company’s main competitors in the third-party alumina market are Aluminum Corporation of China, South32, Hangzhou Jinjiang Group, Rio Tinto, and Norsk Hydro ASA.
The company’s principal competitors in the third-party bauxite market include Rio Tinto and multiple suppliers from Guinea, Australia, and Brazil, among other countries.
Aluminum
The market for primary aluminum is global, and demand for aluminum varies widely from region to region. The company competes with commodity traders, such as Glencore, Trafigura, J. Aron and Gerald Group, and aluminum producers, such as Emirates Global Aluminum, Norsk Hydro ASA, Rio Tinto, Century Aluminum, and Vedanta Aluminum Ltd.
Patents, Trade Secrets, and Trademarks
As of December 31, 2024, Alcoa’s worldwide patent portfolio consisted of approximately 360 granted patents and approximately 200 pending patent applications. The company also has several domestic and international registered trademarks that has significant recognition within the markets that are served, including the name ‘Alcoa’ and the Alcoa symbol.
Government Regulations and Environmental Matters
Alcoa is committed to the Global Industry Standard on Tailings Management (GISTM), an integrated approach to the management and operations of the company’s tailings storage facilities to enhance the safety of these facilities. In August 2023, Alcoa’s impoundments with very high or extreme consequence classification were audited by an independent third party and assessed as in conformance with GISTM as required by the International Council on Mining and Metals Conformance Protocol.
The company maintains remediation and reclamation plans for various sites, and it manages environmental assessments and cleanups at approximately 60 locations, which include owned or operated facilities and adjoining properties, previously owned or operated facilities and adjoining properties, and waste sites, such as U.S. Superfund (Comprehensive Environmental Response, Compensation and Liability Act (CERCLA)) sites.
History
Alcoa Corporation was founded in 1886. The company was incorporated in 2016.
