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Deal sparks promise for Alcoa smelter
A new agreement that will see AGL power a Victorian aluminium smelter for the next four years has secured the future of the facility.
Melissa Coade
Firms: Herbert Smith Freehills (AGL Energy Ltd); Norton Gledhill, White Legal and Venables Lawyers (Alcoa)
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Deal: An agreement to supply electricity to the Alcoa aluminium smelter has been reached by AGL Energy (AGL) and the joint venture participants that own the Portland facility.
Value: Undisclosed
Area: Infrastructure, corporate, finance
Key players: The HSF team advising AGL was led by partner Gerard Pike (pictured). Senior associates Miles Wadley and Brodie Same and executive counsel Peter Davis assisted on the deal.
Deal significance:
As part of the deal, AGL will supply electricity to the Alcoa aluminium smelter in Portland, Victoria for four years.
The agreement will see the equivalent of approximately 10 per cent of Victoria’s total electricity load (510MW) supplied to the smelter.
According to a statement released by HSF, which advised AGL on the transaction, the new agreement was needed to help secure the future of the Portland smelter.
The firm said there had been “significant pressure on all parties to quickly reach a workable deal”.
“This is one of the most significant Australian electricity hedge agreements entered into in recent times,” HSF lead partner Gerard Pike said.
“We were thrilled to be able to help AGL finalise an agreement that will be critically important to the Portland smelter,” he said.
