SMH: Alcoa invests to secure energy supply

INDUSTRIAL giant Alcoa of Australia is set to expand further into the energy sector, continuing a trend for big power consumers to seek direct exposure to oil and gas explorers.

Just days after Fortescue Metals Group was revealed to be negotiating a stake in a shale gas explorer, Alcoa of Australia boss Alan Cransberg revealed his company had spent close to $200 million on exposure to local energy explorers and was likely to make further investments.

Energy security is a crucial issue for Alcoa, with the company's assets understood to consume 20 per cent of Victoria's electricity and about 24 per cent of Western Australia's gas supply. The company has enjoyed decades of cheap energy, thanks to government subsidies and has had almost 95 per cent of its carbon tax exposure waived, albeit temporarily, by the Gillard government.  MORE