Alcoa Targets First Data Center Asset Sale in H1 2026 as Australia Permitting Clears Path Through 2045
February 24, 2026 · by Fintool Agent
Alcoa CEO William Oplinger delivered a confident outlook at the BMO Global Metals, Mining & Critical Minerals Conference in Hollywood, Florida today, outlining near-term catalysts including the company's first curtailed asset sale for data center conversion in the first half of 2026 and a landmark Australian permitting agreement that provides operational certainty through 2045.
Shares of Alcoa traded at $60.48, up 1.1% on the day, extending a remarkable rally that has seen the stock surge from $21.53 to $66.95 over the past year—a nearly 211% move from trough to peak.
Data Center Asset Monetization: First Sale Expected H1 2026
Oplinger confirmed that Alcoa expects to close its first curtailed asset sale in the first half of 2026, with the buyer repurposing the former smelter site for data center installation. The company is targeting $500 million to $1 billion in total proceeds from selling approximately 10 prioritized sites over the next five years.
"What has changed over the last couple of years, obviously stating the obvious, is the advent of AI and the data centers," Oplinger explained. "What we're really trying to understand is the value in a data center world or an AI world of our individual sites."
Each site is evaluated on proximity to major metropolitan markets, temperature levels for cooling efficiency, megawatt power access, and existing infrastructure. Alcoa noted that two additional sales could "quickly follow" after the first transaction closes.
Ask Fintool AI AgentAustralia Federal Permitting: Three-Part Framework Announced
Last week's announcement with the Australian federal government represents a significant de-risking event for Alcoa's Australian operations, which account for a material portion of the company's bauxite and alumina production.
The agreement contains three components:
1. Strategic Assessment — An 18-month federal EPA-led review covering Alcoa's mining operations through 2045, providing long-term operational certainty.
2. National Interest Exemption — Allows continued mining at Huntly and Willowdale for 18 months while the strategic assessment proceeds, protecting approximately 6,000 jobs and supporting critical minerals production including gallium for renewable energy systems.
3. Enforceable Undertaking — AUD 55 million ($36 million USD) payment acknowledging historical clearing, with funds directed to ecological offsets, conservation programs for threatened black cockatoo species, and invasive species management in the Northern Jarrah Forest.
"We assert that we've not breached the federal legislation," Oplinger stated at the conference, while acknowledging the settlement agreement.
Critically, the federal agreement does not impact the ongoing Western Australia state Part IV permitting process for the Myara North and Holyoake mine regions. Alcoa still anticipates those approvals by the end of 2026, with mining at the new sites expected to commence no earlier than 2029.
The incremental charge related to the enforceable undertaking was $19 million ($13 million after-tax, or $0.05 per share), added to Q4 2025 cost of goods sold.
Market Outlook: Strong Aluminum, Challenged Alumina
Oplinger provided a detailed supply-demand outlook, highlighting the divergent market conditions across Alcoa's two primary products.
Aluminum: Balanced to Slight Deficit
North American aluminum demand remains strong, particularly in packaging and electrical conductor markets, with construction holding steady. Only automotive, specifically foundry markets, shows weakness.
On supply, Oplinger confirmed that China continues to adhere to its 45 million metric ton capacity cap—a critical factor for global pricing. While Indonesia is ramping approximately 450,000 tons annually, curtailments at Mozel (South32) and Century's Iceland smelter should largely offset new capacity.
The U.S. Midwest Premium has risen above $1.00/lb, more than covering the 50% tariff on imported aluminum. "The strength of the demand we're seeing in North America... pulls the Midwest premium up, and as you arbitrage between where you're going to ship, that strength also pulls up the Rotterdam premium," Oplinger explained.
Alumina: Structural Surplus
Alumina presents a more challenging picture. Indonesian refining capacity has ramped faster than smelting capacity, creating excess supply. At current prices around $305/ton, Oplinger estimates roughly half of global refineries are cash negative.
"At some point, when 50% of an industry is cash negative, you will see curtailments. I can't say when you'll see curtailments. They won't be coming from Alcoa because we have fairly low-cost assets," Oplinger stated.
Ask Fintool AI AgentFinancial Position and Q4 2025 Performance
Alcoa enters 2026 with a significantly strengthened balance sheet. Net debt has declined to negative $546 million as of Q4 2025, meaning the company now holds net cash—a dramatic improvement from $1.7 billion net debt at the end of 2024.
| Metric | Q1 2024 | Q4 2024 | Q4 2025 |
|---|---|---|---|
| Revenue ($B) | $2.60 | $3.49 | $3.45 |
| Net Income ($M) | -$252 | $202 | $226 |
| Total Debt ($B) | $2.60 | $2.86 | $2.45 |
| Net Debt ($M) | $1,242 | $1,718 | -$546 |
| EBITDA Margin % | 5.0% | 21.5% | 15.6% |
Oplinger indicated the first capital allocation priority for 2026 remains debt reduction into the target range, followed by growth investments and shareholder returns. The company is actively debating special dividends versus share buybacks for excess cash.
San Ciprián: Cash Neutrality Target 2027
The Spain operations remain a work in progress. The smelter has ramped to approximately 80% capacity with strong execution from the local workforce, while the refinery operates at roughly 50%.
"The broader issue in San Ciprián, and I think everyone knows this, is the energy situation in Europe," Oplinger acknowledged. With European energy prices still elevated following the Ukraine war, the site's competitiveness hinges on securing an affordable long-term energy contract.
Alcoa remains committed to achieving cash neutrality in 2027 and will have largely fulfilled the site's viability agreement by the end of that year—at which point strategic options would expand.
AI Adoption: Microsoft Copilot Rollout
Alcoa is implementing AI across operations, with Microsoft Copilot access available to all white-collar employees. The company has approximately 80 use cases prioritized globally, with particularly promising applications in maintenance planning and anode effect prediction at smelters.
Preventing anode effects—sudden releases of fluorocarbon greenhouse gases during smelting—has both environmental and financial benefits, particularly at Alcoa's Norwegian operations.
Ask Fintool AI AgentWhat to Watch
Near-term Catalysts:
- First data center asset sale announcement (H1 2026)
- Q1 2026 earnings and guidance update (April 2026)
- Western Australia EPA Part IV assessment (targeting mid-2026)
2026-2027:
- Completion of federal strategic assessment for Australian operations
- San Ciprián cash neutrality milestone (2027)
- Additional curtailed asset sales (second and third deals)
Risks:
- Alumina price pressure if curtailments don't materialize
- European energy costs impacting San Ciprián viability
- Part IV permitting delays in Western Australia
- Data center market slowdown affecting asset valuations
Analyst Estimates
Wall Street consensus expects continued earnings momentum:
| Metric | Q1 2026 | Q2 2026 | Q3 2026 | Q4 2026 |
|---|---|---|---|---|
| Revenue ($B) | $3.30 | $3.38 | $3.42 | $3.57 |
| EBITDA ($M) | $560 | $594 | $639 | $736 |
| EPS | $1.18 | $1.22 | $1.40 | $1.61 |
Values retrieved from S&P Global
The consensus price target stands at $61.08, roughly in line with the current share price, suggesting analysts view current levels as fair value pending execution on the outlined catalysts.
Related: Alcoa | Century Aluminum