Underlying EBIT increased to NOK 6,133 million compared with NOK 3,351 in 2010. Higher realized alumina and aluminium prices and higher production volumes mainly due to the Vale acquisition had a positive effect on developments for the year. Hydro's new Bauxite & Alumina business achieved significant improvements in operational stability and capacity utilization during 2011. Paragominas, one of the world's largest bauxite mines, achieved record production in 2011. However, underlying results for the new business area were not satisfactory for the full year.
Cost and other improvements in Primary Metal amounted to roughly NOK 1 billion compared to 2009 operating cost levels. This was more than offset, however, by higher prices for key raw materials including power, carbon and alumina. Qatalum reached full capacity in the third quarter of 2011 following a significantly delayed ramp-up due to a power outage in 2010.
Underlying results for Hydro's downstream operations were impacted by weaker markets, in particular for its European extrusion and building systems operations. Underlying EBIT for Hydro's Energy business increased in 2011, mainly due to higher production.
Due to the Vale Aluminium acquisition and Qatalum coming into full production, Hydro's total greenhouse gas emissions increased significantly in 2011. However, emissions from the company's smelters - per mt aluminium produced - are steadily decreasing, and Hydro's greenhouse gas emissions declined by five percent compared to 2010 including the new assets in Brazil on a comparative basis.1) Hydro did not achieve its safety target in 2011 and suffered three fatal accidents including two contractors and one employee.
1) Calculated on a consolidated basis excluding Hydro's 50 percent interest in Qatalum.
