Alcoa Invests in Serra do Facao Hydroelectric Project in Brazil.

NEW YORK -- Alcoa (NYSE:AA) announced today that a shareholder agreement was concluded by the investors in the Serra do Facao hydroelectric plant, which formalizes the creation of a company to construct the power plant in Sao Marcos River, in Brazil's central region.

Investors in the newly incorporated company Romania, the consortium funding the project, are as follows: Brazil federal power company Furnas Centrais Eletricas (49.5%), Alcoa (35%), the Po[?]os de Caldas Municipal Electricity Department (10%) and construction company Camargo Correa (5.5%).

The investment is part of Alcoa's long term strategy of developing energy projects in Latin America to support its smelters and move toward self-sufficiency for its energy needs.

The consortium will be responsible for managing plant construction and its transmission system, and for implementing social and environmental programs in the surrounding communities.

With generation planned to start in 2010, Serra do Facao will produce 210 MW of installed capacity and is a critical piece of Brazil's infrastructure strategy to support economic growth.

Construction of the enterprise, budgeted at R$800 million (approximately $372 million), will start in early 2007, with installation of the construction site in the municipalities of Catalao and Davinopolis, in Goias.

The Serra do Facao Hydroelectric Power Plant investors will adopt a series of initiatives to further the region's efforts to develop in a sustainable way.

About Alcoa Aluminio

Alcoa Aluminio S.A., a subsidiary of Alcoa Inc., has been in Brazil for over 40 years. In Latin America Alcoa has more than 6,000 employees and operations in six Brazilian states (Pernambuco, Minas Gerais, Maranhao, Para, Sao Paulo and Santa Catarina), including a new bauxite mine that is being set up in Juruti (Para). It also has operations in Argentina, Chile, Colombia, Peru and Venezuela, in addition to being a shareholder in the hydroelectric plants of Barra Grande and Machadinho, on the border between Rio Grande do Sul and Santa Catarina. In a ranking prepared by the Brazilian magazines Exame and Epoca, it was considered one of the best companies to work for in Brazil and one of the ten best companies in Latin America, according to the Great Place to Work Institute. More information about Alcoa Latin America can be found on its website: www.alcoa.com.br

About Alcoa

Alcoa is the world's leading producer and manager of primary aluminum, fabricated aluminum and alumina facilities, and is active in all major aspects of the industry. Alcoa serves the aerospace, automotive, packaging, building and construction, commercial transportation and industrial markets, bringing design, engineering, production and other capabilities of Alcoa's businesses to customers. In addition to aluminum products and components, Alcoa also markets consumer brands including Reynolds Wrap[R] foils and plastic wraps, Alcoa[R] wheels, and Baco[R] household wraps. Among its other businesses are closures, fastening systems, precision castings, and electrical distribution systems for cars and trucks. The company has 129,000 employees in 44 countries and has been named one of the top most sustainable corporations in the world at the World Economic Forum in Davos, Switzerland. More information can be found at www.alcoa.com

Notes to Editors:

There should be a tilde over the third "a" in "Serra do Facao," the first "a" in "Sao Marcos River," the third "a" in "Catalao," the third "a" in "Maranhao," and the first "a" in "Sao Paulo" throughout the release.

There should be a cedilla under the first "c" in "Pocos de Caldas" in the second graph of the release.

There should be an accent symbol over the second "e" in "Eletricas," the first "o" in "Davinopolis," the "a" in "Goias," the first "i" in "Alcoa Aluminio," the second "a" in "Para," and the "E" in "Epoca" throughout the release.