International: Rio Tinto terminates Coega aluminium smelter in South Africa

RIO TINTO will not proceed with its Coega aluminium smelter project in South Africa, due to a lack of electricity. South Africa has been subject to rafts of power shortages, with utility Eskom having to ration electricity after a near collapse of the power grid in 2008. Though Eskom is trying to boost supply with expansions, a lack of funds means there continues to be a shortage of electricity. Eskom would have supplied electricity to the 720,000t Greenfield smelter. While both parties have terminated the agreement, they remain open to further discussions on the project in the future. Rio Tinto says it was originally scheduled to start constructing the Coega aluminium smelter in September 2008.