KITIMAT WORKS MODERNIZATION PROJECT ANOTHER STEP CLOSER TO REALIZATION VANCOUVER, Aug. 16 /PRNewswire-FirstCall/ -- Alcan Inc. and BC Hydro have signed a contract for a new power supply agreement for the delivery of Alcan's surplus power to BC Hydro until the end of 2034. The new long-term power supply agreement will be filed with the British Columbia Utilities Commission (BCUC), and will be publicly disclosed as part of the BCUC approval process. "This is a significant step toward the modernization of Kitimat Works," said Michel Jacques, President and Chief Executive Officer, Alcan Primary Metal Group. "Alcan is as committed as ever to realizing this project in B.C. We are confident that this new agreement addresses the findings from the BCUC's decision rendered in December 2006 and builds on the key elements of the new energy policy made public by the B.C. Government in February," he added. The Kitimat Works Modernization Project was announced on August 14, 2006, and is subject to final approval by Alcan's Board of Directors and to the fulfilment of three conditions: approval of the new long-term energy supply agreement from the BCUC, the resolution of environmental permitting issues, and the signing a long-term labour agreement with the Canadian Auto Workers (CAW). Alcan reached an agreement with the CAW in May 2007, and with this new agreement with BC Hydro, the Company is one step closer to fully satisfying two of the three conditions. Alcan is also in advanced discussions with federal and provincial environmental authorities to resolve the permitting issues in the coming weeks. The modernization of Alcan's Kitimat smelter will increase Alcan's annual global primary aluminum production by more than four percent and make Kitimat not only one of Alcan's largest wholly-owned smelters, but also one of the three largest in North America. Kitimat's aluminum production capacity will increase by 40 percent and reduce greenhouse gas emissions by half a million tonnes per year. In addition, the Kitimat modernization will place the smelter in the first quartile of the industry cost curve. Alcan Inc. (NYSE, TSX: AL) is a leading global materials company, delivering high quality products, engineered solutions and services worldwide. With world-class technology and operations in bauxite mining, alumina processing, primary metal smelting, power generation, aluminum fabrication, engineered solutions as well as flexible and specialty packaging, today's Alcan is well positioned to meet and exceed its customers' needs. Alcan is represented by 68,000 employees, including its joint ventures, in 61 countries and regions, posted revenues of US$23.6 billion in 2006. The Company has featured on the Dow Jones Sustainability World Index since 2003. For more information, please visit: http://www.alcan.com/. Statements made in this press release which describe the Company's intentions, expectations or predictions may be forward-looking statements within the meaning of securities laws. By their nature, forward-looking statements involve risk and uncertainty; the Company's actual results or actions could differ materially from those expressed or implied in such forward-looking statements. Reference should be made to the Company's latest Quarterly Report on Form 10-Q for a summary of factors that could cause such differences. %B NM %C 1,3,17,18 %D BC Hydro Contract Signing DATASOURCE: ALCAN - EN CONTACT: Media contact: Colleen Nyce, (250) 639-8760, ; Bryan Tucker, (514) 848-8511, ; Investor contact: Ulf Quellmann, (514) 848-8368,

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