Rio Tinto has declared force majeure on shipments of alumina from its refineries in Queensland, Australia, Bloomberg reported.
This declaration comes as the company faces a shortage of gas needed to power its operations, impacting its ability to produce the raw material used in aluminum manufacturing.
The Yarwun refinery and Queensland Alumina, a joint venture with Russia’s United Co. Rusal International, are the affected facilities.
Sources close to the situation have reported that the plants are struggling to maintain normal operations due to the regional gas deficit.
In March this year, Rio Tinto acknowledged the potential impact of fires in Queensland on the gas pipeline system that serves its plant.
The company has been actively assessing the situation to understand the full implications of the disruption.
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By GlobalData
Despite the force majeure, which typically frees parties from contractual obligations due to circumstances beyond their control, Rio Tinto has confirmed that the supply interruption will only affect third-party sales of alumina.
The company’s own aluminum production operations are expected to continue without disruption.
Meanwhile, in January this year, Rio Tinto was in the news when its Dampier Salt joint venture agreed to divest its Lake MacLeod salt and gypsum operation in Western Australia to Leichhardt Industrials Group.
The A$375m ($251m) deal awaits the fulfilment of certain commercial and regulatory conditions and is due to close by the end of this year. Lake MacLeod, lying within Baiyungu country in the Gascoyne region, is one of three solar salt sites operated by Dampier Salt.
