Global mining group Rio Tinto will invest $1.1bn (CAD$1.4bn) into the expansion of its AP60 aluminium smelter at Complexe Jonquière in Quebec, Canada, the company announced on Monday.

The total investment includes another $113m of financial support from the Quebec government. The expansion will coincide with the gradual closure of potrooms at the Arvida smelter on the same site and will enable the company to increase its output of aluminium for use in transportation, construction, electrical, and consumer goods.

According to the company’s statement, the investment will add 96 new AP60 pots, increasing capacity by approximately 160,000 metric tonnes of primary aluminium per year. This would be enough of the metal to manufacture around 400,000 electric cars. In total, there will be 134 AP60 pots and a capacity of around 220,000 tonnes per annum. The company will also add 30,000 tonnes of new capacity through the commissioning of the newly announced recycling facility at Arvida in the first quarter of 2025.

Construction of the expansion will take two and a half years, with commissioning of the new pots expected to begin in the first half of 2026 and the smelter completed by the end of 2026. Once finished, the expanded smelter is expected to be in the first quartile of the industry cost curve.

The smelter combines lower-carbon technology with hydropower, used across Rio Tinto’s operations in Canada, to generate one-seventh of the greenhouse gas emissions per tonne of aluminium when compared with the industry average, and half the emissions when compared to the technology currently used at the Arvida smelter, the company estimates.

“This is the most significant investment in our aluminium business for more than a decade and it will further strengthen Rio Tinto’s high-quality and low-carbon offering to our customers as they also work to reduce their own carbon footprint”, Rio Tinto Chief Executive Jakob Stausholm said in the statement. He also thanked Canada and Quebec’s governments for their financial support.

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Quebec Premier François Legault said: “Today’s announcement will breathe new life into this industry with greener, less polluting processes. The use of AP60 pots will halve greenhouse gas emissions in aluminium production.”

The investment in the AP60 smelter is already included as replacement capital expenditure in Rio Tinto’s capital investment guidance for 2023 to 2025. The group’s capital expenditure guidance of $9bn to $10bn in both 2024 and 2025 remains unchanged.

In a separate statement put out on Monday, Rio Tinto announced that it has signed memorandum of understanding with steelmaker China Baowu to explore new projects to help decarbonise the steel value chain in China and Australia. The projects discussed include researching, developing and demonstrating a pilot-scale electric melter at a Baowu-owned steel mill in China.