UC RUSAL plans to save $1.1 bln, cut output in 2009

* Saved $554 million in Q1 by cutting production and costs * Q1 aluminium output down 7.2 pct, alumina 25.3 pct yr/yr * Aluminium production costs down 23 percent in Q1 (Adds exchange rate, analyst comment) By Robin Paxton MOSCOW, April 21 (Reuters) - Indebted Russian aluminium company United Company RUSAL saved $554 million in the first quarter of 2009, half of its target for the year, by shedding 23 percent of its production costs and cutting output by 7 percent. UC RUSAL, controlled by billionaire Oleg Deripaska, said on Tuesday it planned to cut costs by a further 26 percent by the end of a year in which aluminium output will decline 11 percent and production of alumina will fall by more than a third. "Our goal is to reduce costs further by Q4, providing us with cost savings of $1.1 billion in 2009," Deripaska, who is also UC RUSAL's chief executive, said in a statement. UC RUSAL, which has debts of around $14 billion, has pledged to cut production after the price of aluminium, used in cars, construction and beverage cans, fell about 60 percent from last July's record high of $3,380 per tonne. The world's largest aluminium producer is in talks to restructure debts with foreign lenders after last month securing a two-month freeze on the $7.4 billion it owes to more than 70 international banks. UC RUSAL said aluminium production fell 7.2 percent to 1.0 million tonnes in the first quarter. It plans to cut full-year 2009 output by 500,000 tonnes, equivalent to 11 percent of its production last year. The company said it cut energy costs by 19 percent in the quarter by signing long-term supply deals and introducing energy-saving technology. It cut raw material costs by 35 percent and management costs by 60 percent. ROUBLE DEVALUATION Deripaska, Russia's richest man a year ago, lost $25.1 billion of his fortune last year -- about a quarter of the cumulative losses of Russia's 10 richest men, the latest Russian edition of Forbes magazine reported on Friday. Russia's once-mighty billionaires are struggling to repay $130 billion in corporate debt due this year after the economic crisis shredded the value of their assets and the rouble lost a third of its value against the dollar since mid-2008. The devaluation of the rouble has, however, helped reduce production costs for Russian miners. A UC RUSAL spokeswoman said the currency's decline against the dollar contributed under 30 percent of the overall cost savings in the first quarter. The company sets its exchange rate budget quarterly. For the first quarter of 2009, the rate was 34 roubles to the dollar. UC RUSAL's core Siberian smelters cut production the least, averaging a 3.2 percent fall over the period. Its smelters in Ukraine, Nigeria and Sweden cut output by an average 23 percent and its plants in Russia's Ural mountains cut 26 percent. "I've more confidence in them managing their operations in Russia. Management of international operations is a little more challenging given that some of these operations are in difficult jurisdictions," Nomura Research analyst Vladimir Zhukov said. Output of intermediate product alumina declined 25.3 percent year-on-year in the first quarter. By the end of 2009, alumina output cuts are forecast to reach 3.9 million tonnes, or 34 percent of last year's production. UC RUSAL has suspended alumina production at the Alpart and Windalco refineries in Jamaica and at Eurallumina in Italy, and cut volumes by 25 percent at the Aughinish refinery in Ireland. Production of bauxite, the ore from which alumina is made, fell 34 percent in the first quarter to 3.0 million tonnes. UC RUSAL plans to cut bauxite output by 5.6 million tonnes in 2009. (Editing by Dan Lalor)