Johannesburg — BHP Billiton's expansion plans for its SA Hillside 3 aluminum plant and Mozal 2 in Mozambique are on track, and should boost the company's aluminum output by more than 400000 tons a year by 2006, the company said yesterday.

Production at Mozal on completion of Mozal 2 will rise from 262000 tons a year to 534000 tons, and at Hillside from current capacity of 532000 tons of aluminum a year to 664000 tons a year.

At its SA Bayside smelter, BHP Billiton's oldest aluminum asset in SA, there are moves to cut costs, and over time the workforce at the plant is expected to fall from 3000 to about 900.

Mohamed Seedat president and chief operation officer of BHP Billiton Aluminum SA said that on completion of the Hillside expansion a break-even cost price based on London Metal Exchange (LME) prices would be $600 a ton. At Mozal, break-even costs after the expansion would be $575/ton, he said.

Aluminum closed at $1374 a ton on the LME yesterday. The price of the metal, which had suffered in the global downturn, has risen 2,6% since the start of the year.

The expansions in southern Africa are part of a $1,5bn investment in the company's aluminum division worldwide.

The Worsley alumina operation in Australia is also part of the expansion project.

BHP Billiton was updating the investment community yesterday on its aluminum division, which in the six months to the end of December last year contributed $192m to the company's earning before interest and tax.

Hillside contributed 28% of that total and Mozal in Mozambique 12%, while Bayside added 5%.

Aluminum made up 13% of BHP Billiton's sales last year with SA operations, which include a 60% stake in ferrochrome and ferro manganese producer Samancor. Ingwe Coal and its aluminum activities accounted for 12% of the company's sales last year.