Hydro's part-owned aluminium smelter in Slovakia, Slovalco, has signed a Letter of Intent (LoI) for power supply with Slovenské Elektrárne.
The LoI covers electricity supply over an eight-year period from January 1, 2014, with a total delivery of 19 terawatt hours (TWh).
Since entering into the existing power contract with Slovenské Elektrárne 20 years ago, power prices in Slovakia have increased. Slovalco will continue to focus on strengthening its competitiveness through efficiency measures and cost improvements, while in parallel working to achieve a competitive future power supply.
The LoI is a first move towards securing the total framework that will enable continued operations at Slovalco. Securing other elements in the power framework will also be important in the process going forward.
Slovalco is a fully consolidated aluminium smelter in Hydro, owned 55% by Hydro Aluminium AS. Slovalco has an annual production capacity of approximately 165,000 metric tons.
Certain statements included within this announcement contain forward-looking information, including, without limitation, those relating to (a) forecasts, projections and estimates, (b) statements of management's plans, objectives and strategies for Hydro, such as planned expansions, investments or other projects, (c) targeted production volumes and costs, capacities or rates, start-up costs, cost reductions and profit objectives, (d) various expectations about future developments in Hydro's markets, particularly prices, supply and demand and competition, (e) results of operations, (f) margins, (g) growth rates, (h) risk management, as well as (i) statements preceded by "expected", "scheduled", "targeted", "planned", "proposed", "intended" or similar statements.
Although we believe that the expectations reflected in such forward-looking statements are reasonable, these forward-looking statements are based on a number of assumptions and forecasts that, by their nature, involve risk and uncertainty. Various factors could cause our actual results to differ materially from those projected in a forward-looking statement or affect the extent to which a particular projection is realized. Factors that could cause these differences include, but are not limited to: our continued ability to reposition and restructure our upstream and downstream aluminium business; changes in availability and cost of energy and raw materials; global supply and demand for aluminium and aluminium products; world economic growth, including rates of inflation and industrial production; changes in the relative value of currencies and the value of commodity contracts; trends in Hydro's key markets and competition; and legislative, regulatory and political factors.
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