Alcoa Australia posts USD 592 million loss on USD 1.25 billion Kwinana rehab costs

Stock image for referential purposes only

The Alcoa plant in Australia entered into losses in 2025 as the costs went up dramatically due to the shutdown and the subsequent cleanup of the Kwinana alumina refinery, which clearly indicated that environmental cleanup was quite costly.

It is clear from the documents filed with the corporate watchdog that Alcoa of Australia had a restructuring charge of USD 1.245 billion during 2025, which was mainly due to the closure of the Kwinana alumina refinery in Perth. Due to this, the company registered a net loss of USD 592 million against a profit of USD 818 million that it had made in 2024.

Also Read: Alumina’s journey through 2025: A year known for ambition, friction and recalibration

The most recent provision consists of USD 614 million that will cover costs incurred in the future when closing down the facility and cleaning up the environment. Added to the previous USD 445 million provision made in 2024, the total cost for closing the Kwinana plant would be around USD 1.7 billion.

Though this was a major setback for the organisation, other operations within its Australian business continued running smoothly. The organisation reported earnings of USD 6.1 billion from alumina and aluminium sales, with expenses of USD 4.9 billion to employees and suppliers, and USD 636 million in dividends to stockholders. 

The Kwinana-related expense is considered a one-off, suggesting a potential return to profitability in 2026, provided no further significant restructuring costs arise.

Explore- Most comprehensive and forward-looking industry-focused report — Global Bauxite & Alumina Market Forecast to 2036: Supply–Demand, Trade Flows & Price Outlook

Alcoa continues to operate bauxite mining activities in Western Australia’s jarrah forest regions along the Darling Scarp, alongside alumina refineries at Pinjarra and Wagerup. It also holds a 55 per cent stake in the Portland aluminium smelter in Victoria.

Must read: Key industry individuals share their thoughts on the trending topics

However, mining operations have faced mounting challenges. Starting from 2023, Alcoa is expected to use low-quality bauxite ore due to delays in approvals for mining new sites as a result of stringent environmental regulations, especially in relation to water catchments around Perth. This has resulted in a steady reduction in bauxite production year after year for the last five years.

In 2029, the company will explore Myara North and Holyoake, a delay from the expected 2027 timeline. Although alumina costs in Western Australia are low, potential export constraints may impact this.