We’re pretty far advanced on that front, and so we expect to make good progress there. And then as a part of that is really finishing the second phase of the engineering work for the project. And that will take several months to complete. Coming out of that engineering work, we’ll have a much better sense and narrow down on what the total capital cost for the projects will be. And hopefully, at that time, we’ll be able to give you a little bit better sense. But at the moment, we’re really just focused on the process of moving the project forward. We’re really excited about the project. We think it’s going to have very attractive returns. And obviously, we find ourselves in an environment with the DOE grant, with the 45X benefits, with the shortness of the U.S. market and the corresponding premiums that we’re able to recognize in the U.S. and this real opportunity to put a cutting-edge facility here in the U.S. close to our customer bases with the flexibility that we offer to them from our existing casthouse of value-added products close to them, we think it’s a really attractive opportunity for us.
Katja Jancic: That’s fair. But is it fair to say that it would be a multibillion-dollar project?
Jesse Gary: Yes, it will absolutely be in that range, Katja.
Katja Jancic: And maybe then on — and I know this is very early, but would you potentially even partner with someone on building this project? Would that be a possibility?
Jesse Gary: Yes. We’re looking at a variety of different financing alternatives. And as I said, we’re pretty confident with all of those items. There will be an attractive opportunity. So we think if we did want to bring in a partner, we think that would definitely be something that would be attractive to them. But it’s a little too early to talk about exactly what the financing structure would look like.
Katja Jancic: Okay. If I may, one more on Jamalco. What is the utilization rate the facility is currently operating?
Jesse Gary: So we’re right around that 1.2 million tonnes of annualized volume that we originally mentioned. And what we’ve been focusing on and what sort of drove some of the improvements and the return to profitability in March is really the stability of the operations coming out of some of those disruptions that we had in Q4. Really proud of the guys for — guys and gals for pushing through and reaching that stability again and returning the plant to profitability. And we’re excited about what it means going forward.
Operator: The next question comes from the line of Timna Tanners of Wolfe Research.
Timna Tanners: I wanted to ask a bit more follow-up on those topics. So on Jamalco, I just wanted to be clear as far as I missed it. Is the equipment outage resolved, and you should be at a more normalized run rate in Q2? Are there lingering issues? Where does that stand?
Jesse Gary: Yes. You’re right on, Timna. Equipment issue is resolved. We should be at that normalized run rate in Q2. And we do expect that the refinery will continue to be profitable over the second quarter.
Timna Tanners: Okay. Great. So this is — you guys are busier than ever. I can’t recall a time that I’ve covered you with quite so many projects in play. You’ve got the new smelter, the casthouse, Iceland casthouse, it’s quite a bit. And just trying to understand high level, you’re deciding to look into a new smelter and add capacity also through the new casthouse, but you also have capacity off-line at Hawesville and Mt. Holly. So first off, where do you see all the additional aluminum going? Is it taking share from imports, I assume? Or is there a really — I mean if you’re doubling capacity through the new smelter and also adding capacity, like what’s the vision there? And also, how do you balance the alternatives between restarting existing capacity and looking to add new capacity and then the primary versus secondary smelters. Just want some more of your thoughts there, please.
Jesse Gary: Yes, sure. Really good question, Timna. And first, I would just like to say one of the — I agree with you, we are just about as busy as we’ve been. A lot of that is driven by our excitement and our views of aluminum demand going forward from here. You see global inventories at postfinancial crisis lows and LME stocks themselves lower than we’ve seen since even before the financial crisis. And we start to see improving demand both in the U.S. and Europe and very strong demand out of China. So we are really excited about the future of the aluminum industry. We think we’re the right metal to meet a lot of the macro trends we spent a lot of time talking about. And that’s really what’s driving all of this work from our part because we think there are opportunities out there for us.
And secondly, I’d like to also just give a little bit of recognition to our operations team. We are as busy as ever on the project front. But it’s because — one of the reasons we’re able to do that is because the operations have been more stable for longer than we’ve seen in a long time, and real credit goes to our operating team for achieving that and with, frankly, have been volatile macro environments. But they’ve kept their nose to the ground, and we’ve really done a good job there. Okay. So then to your question, Timna, we do have a lot of projects in front of us. We do think there’s a lot of opportunities in the U.S. to fill that 4.1 million tonne short position with U.S. production. And indeed, that would — our design would be to replace imports and take that share.
As I said, you will get growth on the demand side, but with volumes like we’re talking about with the new smelter plus the secondary casthouse plus potential for Mt. Holly restart, for instance. And there is a lot of ability to come in and start to fill some of that gap. And we think when you look at the global trends, as I talked about on the call, between 2-32, between Russian sanctions, between Mexican tariffs, a lot of the work that’s going on in the EU, what’s very clear globally is that people are focused on secure supply chains. And because of our operational footprint, we’re better situated to offer that to our customers than really anybody else. And we want to execute on that and continue to offer that to our customers. So we think all of these are viable, and we’re looking at all of these.
We’re continuing to progress the Mt. Holly restart. And as I said on the call, we’re doing the work upfront to make sure that we can execute once we’re ready to go. But all of the — we’re indeed looking at all those projects to know.
