UC RUSAL considers aluminium cuts after dam accident

MOSCOW, Aug 17 - Russia's UC RUSAL, the world's largest aluminium producer, is considering a possible output cut due to a fatal accident at a hydroelectric power station that feeds two of its Siberian smelters, the company said. UC RUSAL's majority owner, billionaire Oleg Deripaska, took part in an emergency meeting chaired by Energy Minister Sergei Shmatko to discuss the use of back-up capacity to ensure energy supplies to RUSAL's smelters, the company said in a statement. "One of the issues discussed was the possibility of reducing output at RUSAL's smelters to create additional reserves of energy required for the stable functioning of the region on the eve of the autumn-winter season, when the load on the energy system increases," the company said. UC RUSAL did not give any details about how much capacity could potentially be cut. Ten people died and more than 60 are missing after a turbine room flooded on Monday at the Sayano-Shushenskaya hydroelectric power station, Russia's largest. [ID:nLH339111] UC RUSAL said production at its Khakassia and Sayanogorsk smelters -- which run on electricity from the damaged power plant -- was so far unaffected as they had switched to alternative suppliers. UC RUSAL, with debts of $16.8 billion, has already embarked on a cost reduction programme this year that led to a 10 percent reduction in aluminium output in the first six months of 2009. The company produced 1.98 million tonnes of primary aluminium in the first half of the year. Cuts at its Siberian smelters totalled 4.5 percent in the period. In 2008, the company produced 4.4 million tonnes of primary aluminium, up from 4.2 million tonnes in 2007. Power for the Sayanogorsk and Khakassia plants is now being supplied from the neighbouring regions of Krasnoyarsk and Kemerovo, said Vladimir Shulekin, spokesman for the Sayanogorsk plant, located about 50 km from the dam.