Noranda Inc. has filed an environmental impact statement in Chile for a proposed $2.75-billion (U.S.) hydroelectric and aluminum project it has been doggedly working on for seven years.
"We are not going to go ahead and build the project without partners and financing," said Dale Coffin, a spokesman for Noranda. The project, called Alumysa, would be too big for Noranda to develop on its own, he said.
The Alumysa project would consist of a 440,000-tonne-a-year aluminum reduction plant, three hydroelectric dams and a port. Construction could take five years.
Toronto-based Noranda said it has spent more than $2-million to assess the impact of the project on the environment. Company officials are meeting with the federal and regional governments as well as with the Chilean environmental agency and the local communities, Mr. Coffin said.
Approval of the environmental impact statement, which took two years to complete, could take about a year, he said.
The project is located in a remote area in the Puerto Aisén region about 642 kilometres south of Santiago.
About 8,100 construction jobs would be created at the peak of building, and once the project is in operation there would be about 1,100 direct permanent jobs, Noranda said.
The cost of the aluminum plant and port is estimated at $1.75-billion. The hydroelectric power plants are expected to cost $930-million and transmission lines and access roads another $70-million.
The project had a setback in 1996 when Australia's Comalco Ltd. said it wouldn't exercise an option to acquire a 50-per-cent interest because it wanted to concentrate on its capital spending projects already under way.
Noranda said it will have to update a feasibility study on Alumysa to take into account the latest economic forecasts and operational data.
The aluminum industry has been consolidating during the past few years. And more recently, aluminum-producing plants have been closed in the western United States because of the shortage and high cost of electricity.
"We hold excellent water and land assets in southern Chile, assets which we believe could support a world-class plant," said Steve Heddle, Noranda's president of aluminum products.
The company has secured the required water rights and land, Mr. Coffin said.
Noranda, a base metal mining company, has the capacity to produce about 240,000 tonnes of aluminum a year at a plant in Missouri.
Aluminua or aluminum oxide is produced from bauxite, the aluminum-bearing ore. Aluminum is produced from alumina by a process that uses large quantities of electrical energy.
Noranda estimates smelting one tonne of aluminum requires between 14 and 18.5 megawatt hours of electric energy.