Alcoa Revises Schedule for Modernization of Baie-Comeau Smelter

Alcoa (NYSE:AA) announced today it is postponing construction of a new
potline at its Baie-Comeau smelter in Qu?bec as part of a revised
modernization plan for the smelter, but will begin preparations for the
upgrade by investing $100 million in the smelter over the next three
years and by permanently closing the plant′s two Soderberg potlines.

The new potline is now expected to be in service in 2019 instead of
2016, subject to board approval. The change is due to current market
conditions.

The $100 million investment includes $30 million that will be used to
upgrade the plant′s casthouse facilities in support of the growing
automotive market. This is in addition to the $75 million already
dedicated to rebuild the port facilities to better meet the future needs
of a modernized plant.

'The Government of Qu?bec proved to be very open to reviewing the
schedule when it became important for Alcoa to adapt to market realities
and make the project as cost-effective as possible,? said Martin Bri?re,
President of Alcoa Canada Primary Products. 'These efforts will help
move our Baie-Comeau plant down the global aluminum cost curve, and
continue to provide important economic benefits to the region.?

The closure of the two Soderberg potlines, which are among the
highest-cost smelting capacity in the Alcoa system, will be complete in
August. The two lines represent 105,000 metric tons of capacity, and are
part of the 460,000 metric tons of smelting capacity Alcoa announced was
under review on May 1.

The revised project schedule will not impact Alcoa′s commitments to the
Government of Qu?bec, and will have a positive effect on the
environment. As agreed in November 2011, the company will provide
$50 ?million over 25 years to the Economic Development Fund managed by
the Government of Qu?bec, and will continue to contribute to its Alcoa
Sustainable Communities Fund with an investment of $10 ?million over
25 ?years for the Baie-Comeau community. In addition, the closure will
result in an immediate 40% reduction in greenhouse gas emissions for the
Baie-Comeau facility.

Capital costs outlined in the announcement are included in the company′s
2013 plan. Total 2013 restructuring-related charges associated with the
closure outlined above are expected to be between $135 million and $155
million after-tax, or $0.11 to $0.13 per share, of which approximately
30% would be recorded in the second quarter. Cash costs during 2013 are
expected to total approximately $100 million.

About Alcoa

Alcoa is the world′s leading producer of primary and fabricated
aluminum, as well as the world′s largest miner of bauxite and refiner of
alumina. In addition to inventing the modern-day aluminum industry,
Alcoa innovation has been behind major milestones in the aerospace,
automotive, packaging, building and construction, commercial
transportation, consumer electronics and industrial markets over the
past 125 years. Among the solutions Alcoa markets are flat-rolled
products, hard alloy extrusions, and forgings, as well as Alcoa ? wheels,
fastening systems, precision and investment castings, and building
systems in addition to its expertise in other light metals such as
titanium and nickel-based super alloys. Sustainability is an integral
part of Alcoa′s operating practices and the product design and
engineering it provides to customers. Alcoa has been a member of the Dow
Jones Sustainability Index for 11 consecutive years and approximately 75
percent of all of the aluminum ever produced since 1888 is still in
active use today. Alcoa employs approximately 61,000 people in 30
countries across the world. For more information, visit www.alcoa.com
and follow @Alcoa on Twitter
at twitter.com/Alcoa.

Forward-Looking Statements

This release contains statements that relate to future events and
expectations and as such constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include those containing such words as
'expects,? 'intends,? 'plans,? 'scheduled,? 'should,? 'will,? or other
words of similar meaning. All statements that reflect Alcoa′s
expectations, assumptions or projections about the future other than
statements of historical fact are forward-looking statements.
Forward-looking statements are subject to a number of known and unknown
risks, uncertainties, and other factors and are not guarantees of future
performance. Important factors that could cause actual results to differ
materially from those expressed or implied in the forward-looking
statements include: (a) ?material adverse changes in aluminum industry
conditions, including global supply and demand conditions and
fluctuations in London Metal Exchange-based prices for primary aluminum,
alumina, and other products; (b) ?deterioration in global economic and
financial market conditions generally, or unfavorable changes in the
markets served by Alcoa; (c) ?Alcoa′s inability to achieve the level of
revenue growth, cash generation, cost savings, improvement in
profitability and margins, fiscal discipline, or strengthening of
competitiveness and operations (including moving its refining and
smelting businesses down on the industry cost curves and increasing
revenues in its Global Rolled Products and Engineered Products and
Solutions segments), anticipated from its portfolio streamlining and
modernization programs, productivity improvement, cash sustainability,
technology and other initiatives; (d) Alcoa′s inability to achieve the
level of reduction in greenhouse gas emissions anticipated from its
closure of the Baie Comeau Soderberg potlines; (e) the outcome of
contingencies, including legal proceedings, government investigations,
and environmental remediation; (f) failure to maintain investment grade
credit ratings which could limit Alcoa′s ability to obtain future
financing, increase its borrowing costs, adversely affect the market
price of its existing securities, or otherwise impair its business,
financial condition and results of operations; (g) Alcoa′s inability to
realize expected benefits, in each case as planned and by targeted
completion dates, from expanded, acquired or modernized facilities, such
as the Baie Comeau smelter; and (h) ?the other risk factors summarized in
Alcoa′s Form 10-K for the year ended December ?31, 2012 and other reports
filed with the Securities and Exchange Commission. Alcoa disclaims any
obligation to update publicly any forward-looking statements, whether in
response to new information, future events or otherwise, except as
required by applicable law.

Alcoa

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