Rio Tinto Group (ASX:RIO) welcomed an agreement between Tomago Aluminium and the Australian and New South Wales governments that will secure reliable, internationally competitive power for Australia's largest aluminum smelter through 2038, according to a Thursday Australian bourse filing.
Tomago Aluminium is an independently managed joint venture owned by Rio Tinto, which holds a nearly 52% stake, Gove Aluminium Finance with about 36%, and Norsk Hydro with more than 12%, per the filing.
The smelter will receive 100% renewable electricity from 2033 under a 10-year power purchase agreement, backed by AU$1.1 billion in investment, including AU$100 million for decarbonization, the filing said.
The deal follows a similar agreement reached in March for the company's Boyne smelter in Queensland, ensuring long-term, cost-competitive and lower-carbon power for Australia's two largest aluminum smelters, the filing added.
The mining giant's shares fell 3% in recent Thursday trade.