Qatalum may now reach capacity from June, CEO Svein Richard Brandtzaeg said adding the site’s production ramp-up is 50% complete.

The technical challenges relate to the cooling water system for the steam turbines under the power plant contract with General Electric/Doosan. The problems were unrelated to the August 2010 power outage, Mr Brandtzaeg added.

The company said it had accelerated its cost saving programme aimed at keeping it among the lower-cost aluminium producers in the world. Its ‘$300/t’ savings plan would now be completed a year ahead of schedule in 2013.

It said it had realised savings of $50/t and targeted a further $125/t for 2011.

The group said it saw aluminium demand growing about 7% this year and 3 to 6% in 2012, adding it expected an improved supply and demand balance. It said global demand for primary aluminium rose 19% in 2010 outside China.

Hydro’s capital expenditures in 2011 were NOK5bn ($844.7M), down from NOK6.7bn ($1.14bn) in 2010.