The Australian and Victorian Governments will invest in a restructure of Alcoa's Point Henry aluminium smelter in Geelong with more than $40 million in assistance to help ensure its economic sustainability and support more than 500 local jobs.
Alcoa will use the assistance as an investment in the efficiency of Point Henry including through workforce skills and training, capital expenditure such as maintenance and repairs and activities that will contribute to the competitiveness of the smelter.
The Minister for Industry and Innovation, Greg Combet, said the $40 million in Federal funding recognised the challenges to the aluminium sector from the high Australian dollar and low world aluminium prices.
"The aluminium industry is under significant pressure due to a substantial decline in world aluminium prices and the high value of the Australian dollar," Mr Combet said.
"Together with the Victorian Government, the Australian Government will provide strategic support to Alcoa so it can restructure its Point Henry operations and help put them on a sustainable footing for the future.
"This assistance is aimed at ensuring the Point Henry smelter's commercial viability and avoiding dislocation to the local community from the loss of more than 500 direct jobs and hundreds more indirect jobs if the smelter were to close."
"The Australian Government recognises the importance of the Point Henry smelter to the Geelong region and will continue to work closely with Alcoa as it restructures the smelter's operations."
Premier Ted Baillieu said the joint Australian and Victorian Government assistance package would secure jobs at the Point Henry Smelter and stimulate growth in the wider Geelong business community.
"In addition to the assistance we are providing Alcoa, the Victorian Coalition Government is also focused on supporting the Alcoa supply chain and contractors and helping local manufacturers diversify, transition and expand," Mr Baillieu said.
"On top of the support we will provide directly to Alcoa, the Coalition Government will also provide a further $4 million to a fund which will be administered by the Victorian Government and run in a similar way to the Geelong Industry and Innovation Fund.
"This fund will allow businesses in the Alcoa supply chain to improve efficiency and productivity. Other businesses in the Geelong region will also be able to access this fund to help further their own growth.
"The Geelong Industry and Innovation Fund, that was co-funded by the Victorian and Commonwealth Governments, has been successful in the past and facilitated 1,100 jobs in the region," Mr Baillieu said.
Minister for Regional Cities Denis Napthine said the support package continued a long history of cooperation between Alcoa and the Victorian Government.
"The Coalition Government has been a strong supporter of employment at both of Alcoa's Victorian smelters," Dr Napthine said.
"Last year, the Coalition Government extended Alcoa's lease at the Anglesea Coal Mine and we will continue to provide further assistance to both smelters in the form of electricity subsidies."
Geelong based members of Victorian Parliament Andrew Katos and David Koch welcomed the Victorian and Australian Government joint assistance package.
Federal Member for Corio, Parliamentary Secretary for Pacific Island Affairs and Foreign Affairs, Richard Marles, said: "This is great news for the thousands of families whose livelihood is connected with Point Henry. With this announcement Alcoa will continue to be a part of the fabric of Geelong."
Darren Cheeseman, federal Member for Corangamite, commented: "Manufacturing is the heart and soul the Geelong economy, having provided a stable income for generations of Geelong families. I'd like to acknowledge the hard work done by Alcoa workers and management in convincing their parent company to invest in the future of manufacturing in Geelong."
Under a funding agreement with Alcoa and subject to the commercial in confidence terms contained within it, the company will keep the Point Henry smelter open for at least another two years.