Asset Retirement Obligations

12 Months Ended

Dec. 31, 2023

Asset Retirement Obligation Disclosure [Abstract]

Asset Retirement Obligations

R. Asset Retirement Obligations

The following table details the carrying value of recorded AROs by major category, of which $217 and $117 was classified as a current liability as of December 31, 2023 and 2022, respectively:

December 31,	2023		2022
Closure of bauxite residue areas	$	437	$	342
Mine reclamation		328		279
Spent pot lining disposal		124		115
Demolition		76		61
Landfill closure		24		31
Balance at end of year	$	989	$	828

The following table details the changes in the total carrying value of recorded AROs:

December 31,	2023			2022
Balance at beginning of year	$	828		$	738
Accretion expense		33			20
Liabilities incurred		254			224
Payments		(148	)		(114	)
Reversals of previously recorded liabilities		(8	)		(12	)
Foreign currency translation and other		30			(28	)
Balance at end of year	$	989		$	828

Liabilities incurred in 2023 include:

•$97 for changes in closure estimates of operating bauxite residue areas;

•$87 for new mining areas opened during the year and higher estimated mine reclamation costs;

•$36 related to the closure of the previously curtailed Intalco smelter;

•$23 related to spent pot lining treatment and disposal;

•$10 for changes in closure estimates of non-operating bauxite residue areas; and,

•$1 related to an accrual for demolition for the closure of a potline at Warrick Operations.

The additional accruals were primarily recorded with corresponding capitalized asset retirement costs except for $15 related to non-operating bauxite residue areas at the Alumar refinery, spent pot lining and treatment, and mine reclamation which was recorded to Cost of goods sold; and $41 related to the closure of the Intalco smelter, updated estimates for spent pot lining treatment and disposal at a previously closed site, and demolition accruals for the closure of a potline at Warrick Operations, which was recorded to Restructuring and other charges, net on the accompanying Statement of Consolidated Operations (see Note D).

Liabilities incurred in 2022 include:

•$81 related to improvements required on both operating and non-operating bauxite residue areas at the Poços de Caldas and Alumar refineries for changes in closure estimates and to comply with updated impoundment regulations in the regions;

•$79 for new mining areas opened during the year and higher estimated mine reclamation costs;

•$28 related to spent pot lining treatment and disposal;

•$18 for bauxite residue areas related to water management at non-operating bauxite residue areas and changes in engineering designs for closure of operating bauxite residue areas;

•$15 related to the closure of the previously curtailed magnesium smelter in Addy (Washington). The facility has been fully curtailed since 2001; and,

•$3 related to accruals for demolition projects at closed sites.

The additional accruals were primarily recorded with corresponding capitalized asset retirement costs (see Note B) except for $72 related to non-operating bauxite reside areas which was recorded to Cost of goods sold at the Poços de Caldas and Alumar refineries and $34 related to the closure of the magnesium smelter in Addy and adjustments to other previously closed sites which were recorded to Restructuring and other charges, net on the accompanying Statement of Consolidated Operations (see Note D).

In 2023, reversals of previously recorded liabilities included a reversal of $8 due to changes in estimates at various sites and the completion of a site demolition project. In 2022, reversals of previously recorded liabilities included a reversal of $12 due to the completion of demolition projects at numerous permanently closed sites.

The estimated timing of cash outflows for recorded AROs at December 31, 2023 was as follows:

2024	$	217
2025 – 2028		573
Thereafter		199
Total	$	989

Changes to the estimates may result in material changes to the recorded AROs that may require an increase to or a reversal of previously recorded liabilities, as well as changes in the timing of cash outflows.