Rio's struggle for long-term energy security for BSL
RIO Tinto's chief executive has called on the Federal Government for an energy policy to ensure the long-term future of its smelters, including Boyne Smelters Limited.
Chief executive Jean-Sebastien Jacques said the company was in talks with state and federal governments, and utility providers over a solution for rising energy costs at its aluminium smelters, but said operations could suffer if a solution was not found.
Mr Jacques told The Australian high energy costs were rendering them uncompetitive in a tough market for the commodity.
"At this point in time it is a very, very challenging situation," he said.
In 2015 Boyne Smelters Limited cut production by 15 per cent and made about 100 workers redundant after it could not reach a deal for 150MW of power.
A Rio Tinto spokesperson told The Observer the company was committed to running a viable, long-term, sustainable operation at Boyne Smelters.
"And to do that we need affordable energy prices if we are to compete in a global market," they said.
"We remain in active discussions with relevant stakeholders to find a solution that may include renewable energy in conjunction with coal-fired generation to provide the internationally competitive firm block of power needed for BSL."
Rio Tinto's half-year report showed the aluminium business's gross revenue was $5.1 million, compared to $6.14 million the year prior, and said the aluminium business was stable operationally, but suffered from price declines.