Century Aluminum Company, the owner of Jamalco, said on Wednesday, November 8, that the malfunction of the power generation unit at the Clarendon-based refinery caused a loss of about US$22 million. Explaining the incident, president & CEO of Century Aluminum Jesse Gary said a power disruption resulted in an equipment failure at the refinery, which led to partial production for a portion of September and all of October.
The loss translates to $3.4 billion in local currency. Jamalco expects to recover almost two-thirds of the total loss from insurance.
Gary added that Century Aluminum had to fly in engineers from the manufacturer to address the cause of the incident and find a long-term solution.
“The impact of the Jamalco equipment failure in the third quarter was approximately US$16.9 million. We estimate an additional impact to our financial results in the fourth quarter of approximately US$5 million,” Century stated. “We expect that all losses arising from the power equipment failure will be covered under our insurance policies, less US$8 million in deductibles.”
Hadn’t the disruption happened, Jamalco would have operated at break-even in the third quarter, even amid the lowest spot alumina prices in the past two-and-a-half-year. Jamaica’s sales totalled US$63.4 million in Q3 2023 and US$107.1 million in nine months, indicating that most of the business activities happened in the recent quarter.
Jamalco’s refinery in Clarendon produces 1.2 million tonnes of alumina a year, which is expected to grow to a full capacity of 1.4 million tonnes next year.
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