Rio Tinto: Monitoring Dam Levels For New Zealand Aluminum Smelter

SYDNEY -(Dow Jones)- Global miner Rio Tinto PLC (RTP) said Friday it was closely monitoring low dam levels for hydroelectric power generation for its Tiwai aluminum smelter in New Zealand.

Rio Tinto buys 10% of the smelter’s electricity needs on the spot market, where prices fluctuate according to supply and demand.

Aluminum smelters, which use huge amounts of electricity, usually seek to have decades-long electricity contracts in place to shield them from electricity price rises.

"We are aware of some issues and are working with our suppliers," said a Rio Tinto spokeswoman.

Disruptions to energy supplies that forced aluminum smelters in China and Southern Africa to temporarily shut down or reduce production earlier this year pushed up prices of the lightweight metal.

The Tiwai smelter, where Rio Tinto owns a 79% stake, produces around 270,000 metric tons annually.