Alcan Pays Powerex Arbitration Award and Recalls Long Term Energy Purchase Agreement 2004/12/29

Kitimat, Canada — Alcan Inc. (NYSE, TSX: AL) announced today that it has paid Powerex, a subsidiary of B.C. Hydro, a sum of US$110 million to settle a claim associated with the collapse of Enron in late 2001. As part of the settlement of issues arising from the cancellation of the Kemano Completion Project, Alcan assigned to Enron Power Marketing Inc. the rights and obligations to deliver a certain quantity power to Powerex. When Enron went bankrupt in 2001, Powerex filed a claim against Alcan and in 2003 an arbitrator confirmed their claim. Alcan recorded a pre-tax charge of US$100 million in the fourth quarter of 2002. The remaining US$10 million will be charged to income in the fourth quarter of 2004. Alcan also announced today that it has advised B.C. Hydro that it is providing 5 year notice of the recall of the 140 MW of power it sells to B.C. Hydro under the Long Term Electricity Purchase Agreement (LTEPA). Under the terms of this agreement, signed in 1990, Alcan may recall electricity under the LTEPA for its own industrial purposes in British Columbia. Alcan is required to give B.C. Hydro a five year notice of any recall and the earliest date Alcan can deliver this notice of recall under the LTEPA is January 1, 2005. “In light of our recent experiences with low water levels in British Columbia and in consideration of our future potential industrial needs in British Columbia, Alcan is acting responsibly with regard to this initiative”, said Alcan Primary Metal Group President and CEO, Cynthia Carroll. The impact of this recall notice will be that all energy deliveries under the LTEPA will end on December 31, 2009. Alcan is a multinational, market-driven company and a global leader in aluminum and packaging, as well as aluminum recycling. With world-class operations in primary aluminum, fabricated aluminum as well as flexible and specialty packaging, aerospace applications, bauxite mining and alumina processing, today’s Alcan is well positioned to meet and exceed its customers' needs for innovative solutions and service. Alcan employs 88,000 people and has operating facilities in 58 countries and regions. -30- Media Contact: Mathieu Bouchard Tel.: +1-514-887-8186 Mathieu.bouchard@alcan.com Richard Prokopanko Tel.: +1-604-257-1405 Richard.prokopanko@alcan.com Investor Contact: Corey Copeland Tel.: +1-514-848-8368 investor.relations@alcan.com

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