We have a management system dedicated to improving productivity and reducing environmental impacts through energy use, while saving money through reduced energy expenditures. Targets for energy and energy-related cost reductions are set annually and endorsed by business unit presidents.

Wherever possible, we purchase only energy-efficient equipment, including energy monitoring and control systems. Energy-efficient guidelines govern capital and maintenance engineering practices. A project has been undertaken to enhance Company-wide energy data collection to further improve overall energy management.

• Our New Madrid, Missouri, aluminum smelting facility saved $753,000 in 2004 through small, highly effective actions. Some changes involved nothing more complicated than turning off lights and heaters when not needed. Another project saw reduced demand for compressed air. These changes resulted in a 5% energy intensity reduction in 2004.

• In recent years, excess heat from processing has been used to heat buildings at the Nikkelverk nickel refinery in Norway. In 2004, the facility entered a co-venture with a local utility company to provide excess heat to local businesses and homes in the form of hot water. Annually, up to 250 gigawatt hours of energy will be available to the community, supplying the energy needs for approximately 5,000 homes. Not only does the system maximize heat recovery in a responsible way, it also makes a profit for Falconbridge and provides heat to the local community at competitive rates.