United States mining giant Alcoa has announced it will halt production at one of its three West Australian alumina refineries, with more than 750 employees set to lose their jobs.
- The plant’s workforce will be cut from about 800 to around 50 by 2025
- An additional 250 contractors are expected to be affected
- Alcoa says its employees will be considered for potential redeployment
The company will stop production at its plant on the Kwinana industrial strip, south of Perth, later this year after more than 60 years of operation.
Announcing the move on Tuesday morning, Alcoa said the plant’s workforce would be cut from about 800 to about 250 in the third quarter of this year, when all production would stop.
Staff numbers would be further reduced to about 50 in 2025.
Alcoa executive vice president Matt Reed said the decision to close the refinery was purely based on cost.
“This is a commercial decision,” he told the ABC.
“We don’t see this as something that relates to policy settings, and I point to the fact that we are very much committed to WA and are continuing to run two large refineries in this state.
“The [Kwinana] facility’s been challenged for some considerable amount of time … the age of the plant, the scale, cost base, and the grade challenges.
“But, that’s obviously a difficult message for our people to hear regardless.”
Mr Reed reaffirmed Alcoa’s commitment to supporting affected staff.
“We are really focused on making sure that we look after them and that they are able to transition effectively into other roles within Alcoa or other organisations,” he said.
The Kwinana refinery recorded a net loss of approximately $US130 million in 2023.
More contractor job losses
Alcoa’s announcement on Tuesday morning only mentioned job losses for its own employees.
The shutdown of production at the Kwinana plant is also expected to affect around 250 contractors, according to the WA government, bringing the total impacted number of workers to about 1,050.
Kwinana plant contractor Kaeleb said he was one of those facing an uncertain future.
“We only found out this morning. They told us nothing,” he said.
“We’re still doing maintenance jobs so you wouldn’t think they’d want to be spending money on maintenance if they were going to shut down.”
Kaeleb said other workers at the plant were anxious about the announcement.
“Everyone’s a bit grim, I suppose … the uncertainty is probably the worst part,” he said.
“No job security, we’ll just see how it all unfolds.”
Many other workers leaving the plant on Tuesday said they were not sure if they still had a job.
Karma, a cleaner at the refinery, said he had not yet heard from Alcoa.
Decision follows week of rumours
Alcoa said its Kwinana employees would be considered for potential redeployment within the business.
“We will work closely with our employees to provide support with transitioning to other opportunities,” Mr Reed said.
Australian Manufacturing Workers Union (AMWU) state secretary Steve McCartney said rumours about Alcoa’s decision had been circulating for the past week.
“We didn’t think it was going to be this quick, and that certain … it was a bit of a surprise to everybody,” he said.
“Very disappointing, especially for the new people that have worked at Alcoa that have just started.”
Mr McCartney said the AMWU would focus on ensuring affected workers had opportunities for transfer or upskilling to other jobs.
Alcoa said its port operations at Kwinana would continue and its Wagerup and Pinjarra refineries were not expected to be affected.
Alcoa urged to help workers
WA Premier Roger Cook said he was told of the decision during a phone call with Alcoa’s vice-president last night, but the state government had been aware of the company’s issues for many months.
Mr Cook said the government was proposing to set up a skills and training kiosk at the Kwinana site to assist workers who were losing their jobs.
“They must be feeling today that there is a cloud over their future and my heart goes out to them,” he said.
“I want them to know that my government will do everything that it can to make sure that we stand by those workers, ensuring that they have other opportunities to work in other parts of Alcoa, but also where they need to be re-skilled, get good advice and training.”
Asked whether Alcoa’s decision was the result of too much red tape surrounding resource projects in Australia, Mr Cook rejected the suggestion.
“It comes down to the commerciality of that older refinery,” he said.
“When I spoke with the vice-president last night, none of those issues were actually raised. In fact, what he said was that he appreciated the work that the government is doing with Alcoa to continue to make sure their operations remain viable,” he said.
Federal Minister for Resources Madeleine King, whose electorate of Brand takes in the refinery and the city of Kwinana, said she was “extremely disappointed” by Alcoa’s decision, which would have a “ripple” effect on the community.
“I expect that Alcoa will do everything it can to ensure workers affected and their families receive all the support they need during this difficult time and I will hold them to account on this,” she said.
“I have been assured by Alcoa that the curtailment of production at the Kwinana refinery will not affect the broader supply chain of alumina, which is essential for our future transition towards net zero emissions.”
The federal opposition has also weighed in, blaming what it called the federal government’s “anti-business” policies in energy, industrial relations and tax for the decision.
WA operations under scrutiny
Alcoa currently employs 4,850 people across Australia, with about 4,300 of them in WA.
The news comes as the company comes under increasing scrutiny over its mining operations in the environmentally vulnerable jarrah forests of WA.
In November, a group of scientists, including some high profile names like professor Tim Flannery, called for a halt to the company’s operations in order to avoid what they described as an “extinction catastrophe”.
And in December, the state’s environmental watchdog announced it would for the first time conduct a rigorous assessment of the company’s bauxite operations.
The Kwinana refinery receives its feedstock, bauxite, from the company’s Huntly Bauxite Mine on the Darling Range, in south-west WA.
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