Call for Clear Deadlines and Plans
The Xunta (Galician government) and the Alcoa committee are pressing Alcoa for clarification on its plans for the anode baking furnace project at the San Cibrao aluminum plant. The company recently announced a temporary postponement of this significant investment, initially estimated at $109 million. Following a meeting, both the Galician government and workforce representatives have urged Alcoa to set clear deadlines for the final approval and execution of this project.
Concerns Over Potential Agreement Breach
There are concerns that Alcoa’s postponement might be a covert cancellation of commitments made in the viability agreement, which includes reactivating the entire factory with improvements by 2025 and guaranteeing jobs. The committee stresses the importance of understanding whether the postponement is for a specific period or indefinitely, to gauge the decision's impact and plan future steps.
Inconsistencies in Alcoa’s Reasoning
The workers' representation has criticized Alcoa's justification of the postponement, citing energy prices and long-term supply contracts. They argue that this contradicts the terms of the signed viability agreement.
Regional Government’s Stance
María Jesús Lorenzana, Regional Minister of Economy, Industry, and Innovation, emphasized the need for Alcoa to clearly define what it means by a temporary deferral and to provide a timeline for the investment. She stated that an indefinite deferral could lead to an analysis of whether the agreement is being adhered to.
Legal Analysis and Union Concerns
The Xunta is consulting its legal services regarding the viability of Alcoa's decision within the agreement framework. The committee also plans to seek the State Attorney's Office's opinion. The viability agreement, renegotiated in January after being initially signed at the end of 2021, was amended to allow more flexibility in the plant's startup, stretching from January to October 2025.
Investment Commitments and Deadlines
Initially, the agreement gave Alcoa two years to undertake investments, prioritizing the anode baking furnace. The amended agreement included a commitment to complete the reform engineering process by last April and an estimation to approve the improvement by November 7, 2023. Additionally, a clause states that if the new furnace isn't operational by December 31, 2025, job guarantees will extend to the end of 2027.
Alcoa’s Response and Future Viability
Alcoa maintains that there are no specific deadlines, as the agreement only contains estimates. The unions express doubts about the plant's viability without the new machinery, which could lead to increased production costs due to the need to import anodes.
Administrative Support and Demands
Lorenzana called for state aid for electro-intensive industries considering Alcoa's risk of relocation. Isabel Rodríguez, the Government subdelegate in Lugo, urged the Executive to exercise its industrial competencies.
This situation represents a critical juncture for the San Cibrao plant, with the future of its operations and workforce hanging in the balance. The resolution of this matter will be crucial in determining the plant's long-term viability and the fulfillment of Alcoa's commitments.
