ASX Announcement 30 May 2016

Alumina Limited acts to protect shareholders' interests in relation to proposed Alcoa Separation

Alumina Limited (ASX:AWC) has carefully considered the implications for its shareholders and for the AWAC joint venture of Alcoa Inc.'s proposed corporate separation. Alumina has serious concerns that the proposal as described by Alcoa will result in a material adverse change in the nature, size, scope and financial wherewithal of Alumina's partner in AWAC.

Alumina has raised these concerns with Alcoa and has proposed amendments to the AWAC joint venture agreements to protect the interests of Alumina's shareholders in a manner that would be executable within the context of Alcoa's demerger process and timeframe. Alumina and Alcoa have been in detailed discussions since early this year to address these matters and those discussions are continuing.

On 27 May 2016, Alcoa filed an application in the Chancery Court in Delaware seeking declarations regarding Alumina's rights in the context of the Alcoa demerger.

Alumina considers that Alcoa's demerger proposal triggers consent and 'first offer' rights in favour of Alumina under the AWAC arrangements. Alumina will vigorously defend the proceedings brought by Alcoa.

The proposed form of demerger as advised by Alcoa to Alumina is fundamentally different to the WMC demerger referred to in Alcoa's complaint. In the case of the Western Mining Corporation (WMC) demerger, WMC (which was renamed Alumina Limited) continued as a participant in AWAC. In the demerger structure advised to Alumina, Alcoa (which is also the current AWAC manager) is seeking to exit AWAC and introduce a new and financially weaker entity into the AWAC partnership. Alcoa is thereby seeking to transfer and assign to that entity its rights, interests and obligations, which requires Alumina's consent.

Further, and as a consequence of the proposed separation, Alumina considers it is entitled to receive various offers, including for the Alcoa interest in AWAC companies.

Alumina will continue to press for the resolution of these issues in a manner that protects the interests of its shareholders and which is consistent with the consent and offer rights conferred in the AWAC joint venture agreements.

Stephen Foster Company Secretary

30 May 2016

Neither Alumina nor any other person warrants or guarantees the future performance of Alumina or any return on any investment made in Alumina securities. This document may contain certain forward-looking statements, including forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. The words "anticipate", "aim", "believe", "expect", "project", "estimate", "forecast", "intend", "likely", "should", "could", "will", "may", "target", "plan" and other similar expressions (including indications of "objectives") are intended to identify forward-looking statements. Indications of, and guidance on, future financial position and performance and distributions, and statements regarding Alumina's future developments and the market outlook, are also forward-looking statements.

Any forward-looking statements contained in this document are not guarantees of future performance. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of Alumina and its directors, officers, employees and agents that may cause actual results to differ materially from those expressed or implied in such statements. Those risks, uncertainties and other factors include (without limitation): (a) material adverse changes in global economic conditions, alumina or aluminium industry conditions or the markets served by AWAC; (b) changes in production or development costs, production levels or sales agreements;

(c) changes in laws, regulations or policies; (d) changes in alumina or aluminium prices or currency exchange rates; (e) Alumina Limited does not hold a majority interest in AWAC and decisions made by majority vote may not be in the best interests of Alumina Limited; and (f) the other risk factors summarised in Alumina's Annual Report 2014. Readers should not place undue reliance on forward-looking statements. Except as required by law, Alumina disclaims any responsibility to update or revise any forward-looking statements to reflect any new information or any change in the events, conditions or circumstances on which a statement is based or to which it relates.

This presentation contains certain non-IFRS financial information. This information is presented to assist in making appropriate comparisons with prior year and to assess the operating performance of the business. Where non-IFRS measures are used, definition of the measure, calculation method and/or reconciliation to IFRS financial information is provided as appropriate or can be found in the Alumina Limited's ASX Half-Year Report for the period ended 30 June 2015.