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Norsk Hydro: Power Failure At Qatalum, Ramp Up Delayed
Aug 11, 2010 08:59CST

LONDON, Aug. 11 -- Norsk Hydro ASA (NHY.OS) has been forced to close its Qatar aluminum smelter following a power failure and has pushed back its targeted date for the plant to reach full capacity into 2011, the company said Tuesday.

The Norwegian company said that Qatalum, which is in ramp-up phase, had been operating at around 60% of capacity--a rate of around 350,000 metric tons a year--before the power failure and was slated to reach full capacity in the fourth quarter.

Power has now been restored, but the liquid electrolyte in most of the 444 affected cells in operation at the time of the incident has solidified, the company said. These cells need to be prepared for restart.

"We don't know how long it will take to get the cells back...We won't meet our schedule for the fourth quarter, that's not realistic," a company spokesman told Dow Jones Newswires. "The remaining 260 cells that hadn't been yet started were not affected and will be started-up on track," the spokesman added.

The smelter, a joint venture with Qatar Petroleum, will produce 585,000 tons of aluminum annually when it reaches full capacity. Hydro's equity share is 290,000 tons.

At 0728 GMT, the company's shares were trading 3.5% lower, or NOK1.19, at NOK32.55 apiece, with Oslo's OBX market down 0.9%.


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