Hydro’s CEO Svein Richard Brandtzæg has appointed CFO Eivind Kallevik as interim head of Bauxite & Alumina with immediate effect, replacing Silvio Porto, in response to the challenging situation at the Alunorte alumina refinery that is currently operating at 50 percent capacity. Kallevik will at the same time remain in his position as CFO.
Brandtzæg will further commission an independent review of Alunorte by an internationally renowned environmental consultancy, and announced measures to assist local communities in Barcarena, and established a project to review and consider further strengthening the robustness of the water treatment at Alunorte, to be led by former head of Bauxite & Alumina Silvio Porto.
“The challenging situation at Alunorte requires a dedicated focus and organization beyond operational competence and capabilities,” says CEO Svein Richard Brandtzæg. “I am grateful that Kallevik is prepared to take on this significant responsibility, and that Silvio Porto will lead the important project launched to further strengthen the environmental robustness of Alunorte.”
Eivind Kallevik held the position as Head of Finance for Bauxite & Alumina in Brazil for two years before taking up the position as CFO in 2013, as well as leading the business area in an interim period in 2016.
Following a period of extraordinary rainfall, federal, state and local authorities in Brazil have ordered a series of measures over concerns that the rain had led to spills from Alunorte into the nearby Para river and caused contamination. These measures include reducing production by 50 percent at Alunorte and halting operations at its bauxite residue disposal DRS2.
The independent review by the internationally renowned environmental consultancy is expected to announce its conclusions and action plans during the first week of April. The review comes in addition to an already established expert task force leading a comprehensive study of Alunorte, reporting directly to the CEO.
Hydro collaborates with local institutions on humanitarian relief to assist communities in Barcarena within health and water. For neighboring communities Vila Nova, Burajuba and Bom Futuro, Hydro commits to working with local partners and investing in proper water supply. Hydro further commits to work with community, civil society and government to clarify the sources of water pollution and other water-related issues in the Barcarena region.
Hydro will also to review and consider further strengthening of Alunorte’s water treatment system as a proactive response to possible future climate and weather changes. This project will be led by Silvio Porto, reporting to Kallevik.
Hydro is South America’s biggest aluminium company after acquiring Brazilian mining company Vale’s aluminium assets in the state of Pará in 2011. Alunorte is the world’s largest alumina refinery, employs around 2,000 people and has a nameplate capacity of an annual 6.3 million tonnes. Hydro owns 92.1 percent of Alunorte.
Barcarena fact sheet
Certain statements included in this announcement contain forward-looking information, including, without limitation, information relating to (a) forecasts, projections and estimates, (b) statements of Hydro management concerning plans, objectives and strategies, such as planned expansions, investments, divestments, curtailments or other projects, (c) targeted production volumes and costs, capacities or rates, start-up costs, cost reductions and profit objectives, (d) various expectations about future developments in Hydro's markets, particularly prices, supply and demand and competition, (e) results of operations, (f) margins, (g) growth rates, (h) risk management, and (i) qualified statements such as "expected", "scheduled", "targeted", "planned", "proposed", "intended" or similar.
Although we believe that the expectations reflected in such forward-looking statements are reasonable, these forward-looking statements are based on a number of assumptions and forecasts that, by their nature, involve risk and uncertainty. Various factors could cause our actual results to differ materially from those projected in a forward-looking statement or affect the extent to which a particular projection is realized. Factors that could cause these differences include, but are not limited to: our continued ability to reposition and restructure our upstream and downstream businesses; changes in availability and cost of energy and raw materials; global supply and demand for aluminium and aluminium products; world economic growth, including rates of inflation and industrial production; changes in the relative value of currencies and the value of commodity contracts; trends in Hydro's key markets and competition; and legislative, regulatory and political factors.
No assurance can be given that such expectations will prove to have been correct. Hydro disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.