British-Australian resources giant Rio Tinto has announced that it will continue operating its NZ Aluminum Smelter (NZAS) at Tiwai Point on New Zealand’s South Island for at least the next 20 years. This decision follows the signing of a long-term power contract with local power companies, benefiting Marubeni Corporation, which is involved in producing low-carbon aluminum at the smelter.
Previously, Rio Tinto had planned to close the smelter at the end of 2024. However, subject to regulatory approval, the company has secured a long-term power supply agreement for 572 megawatts per year starting from July this year and extending for 44 years. The agreement involves Contact Energy, Meridian Energy, and Mercury NZ, the second, third, and fourth largest local power companies, respectively. Of this total, Meridian will supply 377 megawatts.
The power supply agreement also includes a demand response mechanism, allowing NZAS to reduce its power consumption by up to 185 megawatts as needed. S&P Global has assessed that the businesses of these three power companies will be stabilized under the NZAS contract.
In addition to securing the power supply, Rio Tinto recently agreed to acquire a 20.46% interest in NZAS from Sumitomo Chemical, making NZAS a wholly owned subsidiary of Rio Tinto upon completion of the transaction.
Marubeni Corporation announced last year that it would supply “RenewAl,” the world’s first third-party certified low-carbon aluminum product brand, produced by NZAS. This partnership underscores the commitment to producing environmentally friendly aluminum and highlights the strategic importance of the long-term power agreement for the smelter’s continued operation. 
