Rio to cut aluminium output extra 6 pct, shed jobs

* Takes total output cuts to 11 pct of capacity * Will also cut alumina output by 6 pct * To shed 1,100 jobs as part of planned cost cuts * To close Beauharnois, Angelsey ops; to sell China JV * Stock up 1.1 pct, in line with sector index By Eric Onstad LONDON, Jan 20 (Reuters) - Alcan, the aluminium unit of mining group Rio Tinto, plans to cut another six percent of output and will shed 1,100 employees to cut costs after a deeper slide in metals prices, the firm said on Tuesday. The measures are part of a wider programme by Rio Tinto to conserve cash so it can make payments on nearly $40 billion in debt amid the global economic downturn. The move by Canada-based Alcan, the world's second biggest aluminium producer, will bring its total production cuts to 450,000 tonnes, or 11 percent of total annual capacity. The firm also plans to reduce production of alumina, the raw material to make aluminium, by 6 percent, a statement said. The job cuts comprise 800 permanent employees, 3 percent of a total of 26,600, and 300 contractors. The total number of contractor jobs was not immediately available, a Rio spokeswoman in London said. "Our goal is to align production with customer demand and reduce our operating costs as much as possible," said Dick Evans, chief executive of Rio Tinto Alcan. STRATEGIC REVIEW New CEO Jacynthe Cote, who takes over on Feb. 1, is carrying out a review of Alcan's structure and strategy and expects to conclude it by mid-February. Alcan said it had already cut around 5 percent of its aluminium capacity in the fourth quarter, but the worsening economic downturn forced further cuts. Benchmark aluminium prices on the London Metal Exchange have tumbled 60 percent since July and fell as much as 3.8 percent on Tuesday to $1,370 per tonne, the lowest since July 2003. The firm will permanently close down its Beauharnois smelter in Quebec, which produces 52,000 tonnes per year using the old Soderberg technology, which is being phased out in line with environment regulations. Alcan also plans to sell its interest in a Chinese joint venture and close the Anglesey operation in Britain. In alumina, the firm plans to temporarily cut production at its Vaudreuil alumina smelter in Canada by 25 percent, or 400,000 tonnes, and at Gardanne refinery in France by 15 percent, or 105,000 tonnes. Rio Tinto said on Dec. 10 it was cutting a total of 14,000 jobs, or 13 percent of its workforce, slashing capital spending by half and selling more assets. The job cuts announced on Tuesday are included in the December figures. Rio, which mines a range of metals and minerals from aluminium and copper to gold and diamonds, has been under pressure to cut borrowings since its share price slumped after larger rival BHP Billiton scrapped a $66 billion takeover bid for the company in November. Rio took on heavy debt when it paid $38 billion in cash to buy Alcan in 2007. Rio shares, which have shed nearly 40 percent since November, rose 1.1 percent to 1,506 pence in London by 1442 GMT, in line with the UK mining index