Asked by journalists about the future for the aluminium business, Rio's chief executive, Tom Albanese, said it was right to keep smelters running if they could be made profitable, but "if they cannot be viable, we have difficult decisions to make."
A Deutsche Bank report suggesting the assets may be sold in the first half of next year "although there is a risk this is too optimistic," according to Bloomberg reports.
Among assets for sale is a bundle of Australasian smelters, dubbed Pacific Aluminium, which Rio has also indicated it may try to float by initial public offering.
At the time of the sale announcement last year, observers saw a market for well-run smelters operating at slightly below world's best practice, with the Bluff smelter well-maintained and upgraded since its construction in 1971.
The price of power to the smelter has been politically contentious throughout its life, and Rio's renegotiation attempt comes ahead of the likely sale of a 49 per cent stake in state-owned Meridian Energy next year, in a market where industrial electricity demand remains lower than in the mid-2000's.
New Zealand Aluminium Smelters, the 79.4 per cent Rio-owned subsidiary which operates the local smelter, struggles for profitability during aluminium price downturns, such as the 20 per cent slump seen in the last year. Although it reported a $46 million after-tax profit in the year to December 31, that was only thanks to a one-off $65.9 million settlement of a long-standing insurance claim.
Without that, the local unit would have reported a second year of losses in the region of $20 million.
Writing in the Sydney Morning Herald this week, commentator Colin Maiden said even after Rio wrote down its aluminium assets by more than US$8.9 billion in February, "it has almost US$27 billion invested in a division that is earning next to nothing."
NZAS is one of several entities covering Rio's activities in New Zealand. It also owns RTA Pacific (NZ), Rio Tinto Alcan NZ, and RTA Power (NZ), which administers the smelter contracts.
The company has not replied to questions posed last month by BusinessDesk about the relationships between them, and which show an advance to NZAS of $250 million by RTA Pacific (NZ) last year, and a recapitalisation that saw 550 million new shares issued in RTAPNZ.
RTAPNZ reported a $186.4 million profit after tax.