Alcoa announces permanent closure of Kwinana refinery

Alcoa has announced it will permanently close its 60-year-old Kwinana refinery in Perth’s southern suburbs, after undertaking “numerous studies and analyses” to determine its future.

The decision, which will cost the company $1.36 billion (US$890 million), comes after the curtailment of production at the site in mid-2024.

“Multiple factors led to the decision to permanently close the refinery, including the age of the facility, scale and operating costs, market conditions and bauxite grade challenges”: a statement from the company on Tuesday morning read.

Alcoa executive vice president and chief operations officer Matt Reed said the decision to close down had been a difficult one.

“Alcoa operated the Kwinana refinery for a number of years in a challenging environment and made the difficult decision to permanently close the facility after unsuccessfully exploring multiple options for a sustainable path to restarting,” he said.

“We appreciate the dedication and support of our Kwinana employees, contractors and suppliers who have made a major contribution to Western Australia’s economic development and prosperity over more than six decades.”

Reed said Alcoa would work with relevant stakeholders on a safe and responsible closure of the refinery and associated residue storage areas.

The company will also prepare the site for new economic development opportunities, and will work with the state government on potential future land use options.

Alcoa’s port and associated rail facilities at Kwinana will continue to operate.

The Kwinana refinery currently has around 220 employees – a number that will be reduced during 2026 as the closure progresses.

The company has said certain employees will remain beyond 2026 to prepare the site for future redevelopment.

Kwinana Industries Council chief executive David Harrison said the closure was sad but not unexpected and marked the end of an era for local workers and the community.

“Industry is under growing and immense pressure. These include greater competition from overseas operators, ageing and inadequate infrastructure and clunky approvals processes,” Harrison said.

“If we want to see new investment in places like Kwinana, then we cannot afford a business-as-usual approach.

“We need fresh thinking, nimble decision-making and a whole-of-government approach.”

Permanently closing Kwinana’s 2.2 million metric tons of annual capacity will bring Alcoa’s global consolidated refining capacity to 11.7 million metric tons.

Education Minister Sabine Winton was asked about the refinery closure at a press conference on Tuesday morning and said that the decision to close down was “bitterly disappointing” for the state government.

“It’s particularly tough for those workers and those families who will be impacted by that decision,” she said.

“I would urge Alcoa to continue to work with those workers to ensure that they’re supported through this tough, tough process.”

Winton said making sure that the site was properly remediated and had a use going forward would be “front and central” to any government involvement.

WA Nationals leader Shane Love has said the state government would “try to spin this as a future redevelopment opportunity but the reality is it represents the loss of a major industrial asset on their watch”.

“WA’s resources sector is under siege from red and green tape, heavy-handed industrial relations changes, and a Labor-driven push for unionisation that is driving up costs and eroding investor confidence,” he said.

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