Alcan and BC Hydro sign new long-term power purchase agreement



    KITIMAT WORKS MODERNIZATION PROJECT ANOTHER STEP CLOSER TO REALIZATION

    VANCOUVER, Aug. 16 /CNW Telbec/ - Alcan Inc. and BC Hydro have signed a
contract for a new power supply agreement for the delivery of Alcan's surplus
power to BC Hydro until the end of 2034. The new long-term power supply
agreement will be filed with the British Columbia Utilities Commission (BCUC),
and will be publicly disclosed as part of the BCUC approval process.
    "This is a significant step toward the modernization of Kitimat Works,"
said Michel Jacques, President and Chief Executive Officer, Alcan Primary
Metal Group. "Alcan is as committed as ever to realizing this project in B.C.
We are confident that this new agreement addresses the findings from the
BCUC's decision rendered in December 2006 and builds on the key elements of
the new energy policy made public by the B.C. Government in February," he
added.
    The Kitimat Works Modernization Project was announced on August 14, 2006,
and is subject to final approval by Alcan's Board of Directors and to the
fulfilment of three conditions: approval of the new long-term energy supply
agreement from the BCUC, the resolution of environmental permitting issues,
and the signing a long-term labour agreement with the Canadian Auto Workers
(CAW). Alcan reached an agreement with the CAW in May 2007, and with this new
agreement with BC Hydro, the Company is one step closer to fully satisfying
two of the three conditions. Alcan is also in advanced discussions with
federal and provincial environmental authorities to resolve the permitting
issues in the coming weeks.
    The modernization of Alcan's Kitimat smelter will increase Alcan's annual
global primary aluminum production by more than four percent and make Kitimat
not only one of Alcan's largest wholly-owned smelters, but also one of the
three largest in North America. Kitimat's aluminum production capacity will
increase by 40 percent and reduce greenhouse gas emissions by half a million
tonnes per year. In addition, the Kitimat modernization will place the smelter
in the first quartile of the industry cost curve.

    Alcan Inc. (NYSE, TSX: AL) is a leading global materials company,
delivering high quality products, engineered solutions and services worldwide.
With world-class technology and operations in bauxite mining, alumina
processing, primary metal smelting, power generation, aluminum fabrication,
engineered solutions as well as flexible and specialty packaging, today's
Alcan is well positioned to meet and exceed its customers' needs. Alcan is
represented by 68,000 employees, including its joint ventures, in 61 countries
and regions, posted revenues of US$23.6 billion in 2006. The Company has
featured on the Dow Jones Sustainability World Index since 2003. For more
information, please visit: www.alcan.com.

    Statements made in this press release which describe the Company's
intentions, expectations or predictions may be forward-looking statements
within the meaning of securities laws. By their nature, forward-looking
statements involve risk and uncertainty; the Company's actual results or
actions could differ materially from those expressed or implied in such
forward-looking statements. Reference should be made to the Company's latest
Quarterly Report on Form 10-Q for a summary of factors that could cause such
differences.

    %B NM %C 1,3,17,18 %D BC Hydro Contract Signing




For further information:

For further information: Media contact: Colleen Nyce, (250) 639-8760,
colleen.nyce@alcan.com; Bryan Tucker, (514) 848-8511,
media.relations@alcan.com; Investor contact: Ulf Quellmann, (514) 848-8368,
investor.relations@alcan.com

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