The owners of Tiwai Point aluminium smelter have written down the value of the plant by more than $500 million.
Excluding the write-down, Rio Tinto Alcan New Zealand, which owns 79% of New Zealand Aluminium Smelters, has reported an operating pre-tax loss of $91.5 million.
The company blames the loss on sharply lower aluminium prices, which fell 16% last year, high electricity prices and the strong New Zealand dollar.
The smelter company says production was cut due to high spot electricity prices. Tiwai Point uses about 14% of the country's total electricity consumption and is continuing talks with Meridian over a long term electricity contract.
Pacific Aluminium chief operating officer Brian Cooper says the company has been working with Tiwai Point employees to improve operations at the smelter and enable it to survive and safeguard the facility's 800 jobs.
Mr Cooper says with improvements being made at the operation and a globally competitive electricity price the smelter can operate on a sustainable footing for many years to come.
Tiwai Point is part of a group of Australiasian aluminium production assets Rio is trying to sell.