KAISER ALUMINUM CORP
10-Q, 1999-05-07
PRIMARY PRODUCTION OF ALUMINUM
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===========================================================================




                     SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C.  20549


                                 FORM 10-Q


          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                      SECURITIES EXCHANGE ACT OF 1934

               FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1999

                       Commission file number 1-9447




                        KAISER ALUMINUM CORPORATION
           (Exact name of registrant as specified in its charter)


              DELAWARE                               94-3030279
      (State of incorporation)            (I.R.S. Employer Identification
                                             No.)


          5847 SAN FELIPE, SUITE 2600, HOUSTON, TEXAS  77057-3010
            (Address of principal executive offices)   (Zip Code)


                               (713) 267-3777
            (Registrant's telephone number, including area code)





     Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Yes   x        No       
    -----        -------

     At April 30, 1999, the registrant had 79,397,413 shares of Common
Stock outstanding.





===========================================================================

            KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

                       PART I - FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS
         --------------------

                        CONSOLIDATED BALANCE SHEETS
                          (In millions of dollars)

<TABLE>

<CAPTION>
                                                                 March 31,    December 31,
                                                                      1999            1998
                                                            ------------------------------
<S>                                                         <C>             <C>
                           ASSETS                             (Unaudited)
Current assets:
     Cash and cash equivalents                              $        10.8   $        98.3 
     Receivables                                                    275.8           282.7 
     Inventories                                                    528.7           543.5 
     Prepaid expenses and other current assets                      116.1           105.5 
                                                            ------------------------------
          Total current assets                                      931.4         1,030.0 

Investments in and advances to unconsolidated affiliates            129.9           128.3 
Property, plant, and equipment - net                              1,098.6         1,108.7 
Deferred income taxes                                               396.0           377.9 
Other assets                                                        377.7           346.0 
                                                            ------------------------------

          Total                                             $     2,933.6   $     2,990.9 
                                                            ==============================

             LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
     Accounts payable                                       $       151.7   $       173.3 
     Accrued interest                                                24.7            37.3 
     Accrued salaries, wages, and related expenses                   66.4            73.8 
     Accrued postretirement medical benefit obligation - 
          current portion                                            48.2            48.2
     Other accrued liabilities                                      178.8           148.3 
     Payable to affiliates                                           81.5            77.1 
     Long-term debt - current portion                                  .4              .4 
                                                            ------------------------------
          Total current liabilities                                 551.7           558.4 

Long-term liabilities                                               531.0           532.9 
Accrued postretirement medical benefit obligation                   690.9           694.3 
Long-term debt                                                      962.3           962.6 
Minority interests                                                  116.7           123.5 
Commitments and contingencies
Stockholders' equity:
     Common stock                                                      .8              .8 
     Additional capital                                             535.4           535.4 
     Accumulated deficit                                           (455.2)         (417.0)
                                                            ------------------------------
          Total stockholders' equity                                 81.0           119.2 
                                                            ------------------------------

               Total                                        $     2,933.6   $     2,990.9 
                                                            ==============================


</TABLE>




The accompanying notes to interim consolidated financial statements are an 
     integral part of these statements.

            KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

                  STATEMENTS OF CONSOLIDATED INCOME (LOSS)
                                (Unaudited)
               (In millions of dollars, except share amounts)

<TABLE>

<CAPTION>
                                                                     Quarter Ended
                                                                       March 31,
                                                            ------------------------------
                                                                      1999            1998
                                                            ------------------------------
<S>                                                         <C>             <C>
Net sales                                                   $       479.4   $       597.0 
                                                            ------------------------------

Costs and expenses:
     Cost of products sold                                          459.9           497.1 
     Depreciation and amortization                                   24.4            25.4 
     Selling, administrative, research and development,
          and general                                                28.1            29.7      
                                                            ------------------------------
               Total costs and expenses                             512.4           552.2 
                                                            ------------------------------

Operating income (loss)                                             (33.0)           44.8 

Other income (expense):
     Interest expense                                               (27.7)          (28.0)
     Other - net                                                      1.3              .8 
                                                            ------------------------------

Income (loss) before income taxes and minority interests            (59.4)           17.6 

Benefit (provision) for income taxes                                 20.2            (6.2)

Minority interests                                                    1.0              .6 
                                                            ------------------------------

Net income (loss)                                           $       (38.2)  $        12.0 
                                                            ==============================

Earnings (loss) per share:
     Basic                                                  $        (.48)  $         .15 

     Diluted                                                $        (.48)  $         .15 

Weighted average shares outstanding (000):
     Basic                                                         79,154          79,008 

     Diluted                                                       79,154          79,086 

</TABLE>




The accompanying notes to interim consolidated financial statements are an 
     integral part of these statements.

            KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

                   STATEMENTS OF CONSOLIDATED CASH FLOWS
                                (Unaudited)
                          (In millions of dollars)
<TABLE>

<CAPTION>
                                                                     Quarter Ended
                                                                       March 31,
                                                            ------------------------------
                                                                      1999            1998
                                                            ------------------------------
<S>                                                         <C>             <C>
Cash flows from operating activities:
     Net income (loss)                                      $       (38.2)  $        12.0 
     Adjustments to reconcile net income (loss) to net cash                               
          (used) provided by operating activities:
          Depreciation and amortization (including deferred
               financing costs)                                      25.4            26.7        
          Equity in (income) loss of unconsolidated
               affiliates, net of distributions                      (4.4)           (3.7)        
          Minority interests                                         (1.1)            (.6)
          Decrease in receivables                                     6.9            21.0 
          Decrease in inventories                                    14.8            40.2 
          Increase in prepaid expenses and other current
               assets                                               (11.7)           (1.2)
          Decrease in accounts payable and accrued interest         (34.2)          (38.6)
          Increase (decrease) in payable to affiliates and
               other accrued liabilities                             26.4           (24.6)
          Decrease in accrued and deferred income taxes             (20.5)           (1.1)
          Decrease in net long-term assets and liabilities          (31.0)           (8.1)
          Other                                                        .1             1.6 
                                                            ------------------------------
               Net cash (used) provided by operating
                    activities                                      (67.5)           23.6
                                                            ------------------------------

Cash flows from investing activities:
     Capital expenditures                                           (16.5)          (13.7)
     Other                                                           (2.7)           (3.2)
                                                            ------------------------------
               Net cash used by investing activities                (19.2)          (16.9)
                                                            ------------------------------
Cash flows from financing activities:
     Borrowings under revolving credit facility, net                 -               -
     Repayments of long-term debt                                     (.3)            (.9)
     Decrease in restricted cash, net                                  .8              .6 
     Redemption of minority interests' preference stock              (1.3)           (1.1)
                                                            ------------------------------
               Net cash used by financing activities                  (.8)           (1.4)
                                                            ------------------------------

Net (decrease) increase in cash and cash equivalents
     during the period                                              (87.5)            5.3
Cash and cash equivalents at beginning of period                     98.3            15.8 
                                                            ------------------------------
Cash and cash equivalents at end of period                  $        10.8   $        21.1 
                                                            ==============================

Supplemental disclosure of cash flow information:
     Interest paid, net of capitalized interest             $        39.3   $        39.4 
     Income taxes paid                                                 .5             6.4 

</TABLE>



The accompanying notes to interim consolidated financial statements are an 
     integral part of these statements.

             NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
       (In millions of dollars, except prices and per share amounts)

1.   GENERAL

     Kaiser Aluminum Corporation (the "Company") is a subsidiary of MAXXAM
Inc. ("MAXXAM").  MAXXAM and one of its wholly owned subsidiaries together
own approximately 63% of the Company's Common Stock with the remaining
approximately 37% publicly held.  The Company operates through its
subsidiary, Kaiser Aluminum & Chemical Corporation ("KACC").

     The foregoing unaudited interim consolidated financial statements have
been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q
and Article 10 of Regulation S-X as promulgated by the Securities and
Exchange Commission.  Accordingly, these financial statements do not
include all of the disclosures required by generally accepted accounting
principles for complete financial statements.  These unaudited interim
consolidated financial statements should be read in conjunction with the
audited consolidated financial statements for the year ended December 31,
1998.  In the opinion of management, the unaudited interim consolidated
financial statements furnished herein include all adjustments, all of which
are of a normal recurring nature, necessary for a fair statement of the
results for the interim periods presented.

     The preparation of financial statements in accordance with generally
accepted accounting principles requires the use of estimates and
assumptions that affect the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities known to exist as of the
date the financial statements are published, and the reported amounts of
revenues and expenses during the reporting period. Uncertainties with
respect to such estimates and assumptions are inherent in the preparation
of the Company's consolidated financial statements; accordingly, it is
possible that the actual results could differ from these estimates and
assumptions, which could have a material effect on the reported amounts of
the Company's consolidated financial position and results of operations.

     Operating results for the quarter ended March 31, 1999, are not
necessarily indicative of the results that may be expected for the year
ending December 31, 1999.

     Certain reclassifications of prior-year information were made to
conform to the current presentation.

LABOR RELATED COSTS
     The Company is currently operating five of its U.S. facilities with
salaried employees and other workers as a result of the September 30, 1998,
strike by the United Steelworkers of America ("USWA") and the subsequent
"lock-out" by the Company in January 1999.  For purposes of computing the
costs and liabilities related to pension and other postretirement medical
plans reflected in the accompanying interim consolidated financial
statements for the quarter ended March 31, 1999, the Company based its
accruals on the terms of the previously existing (expired) USWA contract. 
Any differences between the amounts accrued and the amounts ultimately
agreed to during the collective bargaining process will be reflected in
future results during the term of any new contract.

RECENT ACCOUNTING PRONOUNCEMENTS
     Statement of Financial Accounting Standards No. 133, Accounting for
Derivative Instruments and Hedging Activities ("SFAS No. 133") requires
companies to recognize all derivative instruments as assets or liabilities
in the balance sheet and to measure those instruments at fair value.  SFAS
No. 133 must be adopted by the Company no later than January 1, 2000,
although earlier application is permitted.  Under SFAS No. 133, the Company
will be required to "mark-to-market" its hedging positions at each period
end in advance of reflecting the physical transactions to which the hedges
relate.  Changes in the fair value of the Company's open hedging positions
will be reflected as an increase or reduction in stockholders' equity
through comprehensive income.  The impact of the changes in fair value of
the Company's hedging positions will reverse out of comprehensive income
(net of any fluctuations in other "open" positions) and will be reflected
in traditional net income when the subsequent physical transactions occur. 
Currently, the dollar amount of the Company's comprehensive income
adjustments is not significant so there is not a significant difference
between "traditional" net income and comprehensive income.  However,
differences between comprehensive income and traditional net income may
become significant in future periods as SFAS No. 133 will result in
fluctuations in comprehensive income and stockholders' equity in periods of
price volatility, despite the fact that the Company's cash flow and
earnings will be "fixed" to the extent hedged.  The amount of such
fluctuations could be significant.  This result is contrary to the intent
of the Company's hedging program, which is to "lock-in" a price (or range
of prices) for products sold/used so that earnings and cash flows are
subject to reduced risk of volatility.

     The Company is currently evaluating how and when to implement SFAS No.
133.

2.   EARNINGS (LOSS) PER SHARE

Basic - Basic earnings (loss) per share is computed by dividing net income
(loss) by the weighted average number of shares of Common Stock outstanding
during the period including the weighted average impact of the shares of
Common Stock issued during the year from the date(s) of issuance.

Diluted - Diluted earnings (loss) per share for the quarter ended March 31,
1998, includes the dilutive effect of outstanding stock options of 78,000
shares.  The impact of outstanding stock options was excluded from the
computation for the quarter ended March 31, 1999, as its effect would have
been antidilutive.

3.   INVENTORIES

     The classification of inventories is as follows:

<TABLE>

<CAPTION>
                                                                 March 31,    December 31,
                                                                      1999            1998
                                                            ------------------------------
<S>                                                         <C>             <C>
Finished fabricated aluminum products                       $        121.9  $        112.4
Primary aluminum and work in process                                 168.0           205.6
Bauxite and alumina                                                  120.2           109.5
Operating supplies and repair and maintenance parts                  118.6           116.0
                                                            ------------------------------
     Total                                                  $        528.7  $        543.5
                                                            ==============================

</TABLE>

     Substantially all product inventories are stated at last-in, first-out
(LIFO) cost, not in excess of market. Replacement cost is not in excess of
LIFO cost.

4.   CONTINGENCIES

ENVIRONMENTAL CONTINGENCIES
     The Company and KACC are subject to a number of environmental laws, to
fines or penalties assessed for alleged breaches of such environmental
laws, and to claims and litigation based upon such laws.  KACC currently is
subject to a number of claims under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended by the
Superfund Amendments Reauthorization Act of 1986 ("CERCLA"), and, along
with certain other entities, has been named as a potentially responsible
party for remedial costs at certain third-party sites listed on the
National Priorities List under CERCLA.

     Based on the Company's evaluation of these and other environmental
matters, the Company has established environmental accruals primarily
related to potential solid waste disposal and soil and groundwater
remediation matters.  At March 31, 1999, the balance of such accruals,
which are primarily included in Long-term liabilities, was $50.5.  These
environmental accruals represent the Company's estimate of costs reasonably
expected to be incurred based on presently enacted laws and regulations,
currently available facts, existing technology, and the Company's
assessment of the likely remediation actions to be taken.  The Company
expects that these remediation actions will be taken over the next several
years and estimates that annual expenditures to be charged to these
environmental accruals will be approximately $3.0 to $8.0 for the years
1999 through 2003 and an aggregate of approximately $29.0 thereafter.

     As additional facts are developed and definitive remediation plans and
necessary regulatory approvals for implementation of remediation are
established or alternative technologies are developed, changes in these and
other factors may result in actual costs exceeding the current
environmental accruals.  As the resolution of these matters is subject to
further regulatory review and approval, no specific assurance can be given
as to when the factors upon which a substantial portion of this estimate is
based can be expected to be resolved.  However, the Company is currently
working to resolve certain of these matters.

     The Company believes that it has insurance coverage available to
recover certain incurred and future environmental costs and is actively
pursuing claims in this regard.  No assurances can be given that the
Company will be successful in attempts to recover incurred or future costs
from insurers or that the amount of recoveries received will ultimately be
adequate to cover costs incurred.

     While uncertainties are inherent in the final outcome of these
environmental matters, and it is presently impossible to determine the
actual costs that ultimately may be incurred, management currently believes
that the resolution of such uncertainties should not have a material
adverse effect on the Company's consolidated financial position, results of
operations, or liquidity.

ASBESTOS CONTINGENCIES
     KACC is a defendant in a number of lawsuits, some of which involve
claims of multiple persons, in which the plaintiffs allege that certain of
their injuries were caused by, among other things, exposure to asbestos
during, and as a result of, their employment or association with KACC or
exposure to products containing asbestos produced or sold by KACC.  The
lawsuits generally relate to products KACC has not sold for at least 20
years.  At March 31, 1999, the number of such claims pending was
approximately 91,300, as compared with 86,400 at December 31, 1998.  In
1998, approximately 22,900 of such claims were received and 13,900 were
settled or dismissed.  During the quarter ended March 31, 1999,
approximately 9,300 of such claims were received and 4,400 of such claims
were settled or dismissed.  However, the foregoing claim and settlement
figures as of and for the quarter ended March 31, 1999, do not reflect the
fact that as of March 31, 1999, KACC has reached agreements under which it
will settle approximately 26,000 of the pending asbestos-related claims
over an extended period.

     Based on past experience and reasonably anticipated future activity,
the Company has established an accrual for estimated asbestos-related costs
for claims filed and estimated to be filed through 2008.  There are
inherent uncertainties involved in estimating asbestos-related costs, and
the Company's actual costs could exceed these estimates.  The Company's
accrual was calculated based on the current and anticipated number of
asbestos-related claims, the prior timing and amounts of asbestos-related
payments, and the advice of Wharton Levin Ehrmantraut Klein & Nash, P.A.,
with respect to the current state of the law related to asbestos claims. 
Accordingly, an estimated asbestos-related cost accrual of $187.7, before
consideration of insurance recoveries, is included primarily in Long-term
liabilities at March 31, 1999.  While the Company does not presently
believe there is a reasonable basis for estimating such costs beyond 2008
and, accordingly, no accrual has been recorded for such costs which may be
incurred beyond 2008, there is a reasonable possibility that such costs may
continue beyond 2008, and such costs may be substantial.  The Company
estimates that annual future cash payments in connection with such
litigation will be approximately $17.0 to $28.0 for each of the years 1999
through 2003, and an aggregate of approximately $79.0 thereafter.

     The Company believes that KACC has insurance coverage available to
recover a substantial portion of its asbestos-related costs.  Although the
Company has settled asbestos-related coverage matters with certain of its
insurance carriers, other carriers have not yet agreed to settlements.  The
timing and amount of future recoveries from these insurance carriers will
depend on the pace of claims review and processing by such carriers and on
the resolution of any disputes regarding coverage under such policies.  The
Company believes, that substantial recoveries from the insurance carriers
are probable.  The Company reached this conclusion after considering its
prior insurance-related recoveries in respect of asbestos-related claims;
existing insurance policies; and the advice of Heller Ehrman White &
McAuliffe with respect to applicable insurance coverage law relating to the
terms and conditions of those policies. Accordingly, an estimated aggregate
insurance recovery of $157.3, determined on the same basis as the asbestos-
related cost accrual, is recorded primarily in Other assets at March 31,
1999.

     Management continues to monitor claims activity, the status of
lawsuits (including settlement initiatives), legislative developments, and
costs incurred in order to ascertain whether an adjustment to the existing
accruals should be made to the extent that historical experience may differ
significantly from the Company's underlying assumptions. While
uncertainties are inherent in the final outcome of these asbestos matters
and it is presently impossible to determine the actual costs that
ultimately may be incurred and insurance recoveries that will be received,
management currently believes that, based on the factors discussed in the
preceding paragraphs, the resolution of asbestos-related uncertainties and
the incurrence of asbestos-related costs net of related insurance
recoveries should not have a material adverse effect on the Company's
consolidated financial position, results of operations, or liquidity.

LABOR MATTERS
     In connection with the USWA strike and subsequent lock-out by KACC,
certain allegations of unfair labor practices ("ULPs") have been filed with
the National Labor Relations Board by the USWA.  KACC is responding to all
such allegations and believes that they are without merit.  If the
allegations were sustained, KACC could be required to make locked-out
employees whole for back wages from the date of the lock-out in January
1999.  While uncertainties are inherent in the final outcome of such
matters, the Company believes that the resolution of the alleged ULPs
should not result in a material adverse effect on the Company's
consolidated financial position, results of operations, or liquidity.

OTHER CONTINGENCIES
     The Company or KACC is involved in various other claims, lawsuits, and
other proceedings relating to a wide variety of matters.  While
uncertainties are inherent in the final outcome of such matters, and it is
presently impossible to determine the actual costs that ultimately may be
incurred, management currently believes that the resolution of such
uncertainties and the incurrence of such costs should not have a material
adverse effect on the Company's consolidated financial position, results of
operations, or liquidity.

     See Note 9 of Notes to Consolidated Financial Statements for the year
ended December 31, 1998.

5.   DERIVATIVE FINANCIAL INSTRUMENTS AND RELATED HEDGING PROGRAMS

     At March 31, 1999, the net unrealized gain on KACC's position in
aluminum forward sales and option contracts, energy forward purchase and
option contracts, and forward foreign exchange contracts, was approximately
$28.9 (based on comparisons to applicable quarter-end published market
prices).  As KACC's hedging activities are generally designed to lock-in a
specified price or range of prices, gains or losses on the derivative
contracts utilized in these hedging activities will generally be offset by
losses or gains, respectively, on the transactions being hedged.

ALUMINA AND ALUMINUM
     The Company's earnings are sensitive to changes in the prices of
alumina, primary aluminum and fabricated aluminum products, and also depend
to a significant degree upon the volume and mix of all products sold. 
Primary aluminum prices have historically been subject to significant
cyclical price fluctuations.  Alumina prices as well as fabricated aluminum
product prices (which vary considerably among products) are significantly
influenced by changes in the price of primary aluminum but generally lag
behind primary aluminum price changes by up to three months.  Since 1993,
the Average Midwest United States transaction price for primary aluminum
has ranged from approximately $.50 to $1.00 per pound.

     From time to time in the ordinary course of business, KACC enters into
hedging transactions to provide price risk management in respect of the net
exposure of earnings and cash flows resulting from (i) anticipated sales of
alumina, primary aluminum and fabricated aluminum products, less (ii)
expected purchases of certain items, such as aluminum scrap, rolling ingot,
and bauxite, whose prices fluctuate with the price of primary aluminum. 
Forward sales contracts are used by KACC to effectively fix the price that
KACC will receive for its shipments.  KACC also uses option contracts (i)
to establish a minimum price for its product shipments, (ii) to establish a
"collar" or range of prices for KACC's anticipated sales, and/or (iii) to
permit KACC to realize possible upside price movements.  As of March 31,
1999, KACC had sold forward, at fixed prices, approximately 18,000 tons of
primary aluminum with respect to 1999.  As of March 31, 1999, KACC had also
entered into option contracts that established a price range for an
additional 144,000 and 323,000 tons of primary aluminum for 1999 and 2000,
respectively.

     Additionally, through March 31, 1999, KACC had also entered a series
of transactions with a counterparty that will provide KACC with a premium
over the forward market prices at the date of the transaction for 4,000
tons of primary aluminum per month during the period July 1999 through June
2001.  KACC also contracted with the counterparty to receive certain fixed
prices (also above the forward market prices at the date of the
transaction) on 8,000 tons of primary aluminum per month over a three year
period commencing October 2001, unless market prices during certain periods
decline below a stipulated "floor" price, in which case, the fixed price
sales portion of the transactions terminate.  The price at which the
October 2001 and later transactions terminate is well below current market
prices.  While the Company believes that the October 2001 and later
transactions are consistent with its stated hedging objectives, these
positions do not qualify for treatment as a "hedge" under current
accounting guidelines. Accordingly, these positions will be "marked to
market" each period.   For the quarter ended March 31, 1999, the Company
recorded a mark-to-market charge of $0.5 in Other income (expense)
associated with the above transactions.

     As of March 31, 1999, KACC had sold forward virtually all of the
alumina available to it in excess of its projected internal smelting
requirements for 1999, 2000 and 2001 at prices indexed to future prices of
primary aluminum.

ENERGY
     KACC is exposed to energy price risk from fluctuating prices for fuel
oil and natural gas consumed in the production process.  Accordingly, KACC
from time to time in the ordinary course of business enters into hedging
transactions with major suppliers of energy and energy related financial
instruments.  As of March 31, 1999, KACC had a combination of fixed price
purchase and option contracts for the purchase of approximately 32,700
MMBtu of natural gas per day during the remainder of 1999.  As of March 31,
1999, KACC also held a combination of fixed price purchase and option
contracts for an average of 246,000 and 179,000 barrels per month of fuel
oil and diesel fuel for 1999 and 2000, respectively.

FOREIGN CURRENCY
     KACC enters into forward exchange contracts to hedge material cash
commitments to foreign subsidiaries or affiliates.  At March 31, 1999, KACC
had net forward foreign exchange contracts totaling approximately $132.3
for the purchase of 198.6 Australian dollars from April 1999 through
December 2000, in respect of its commitments for the remainder of 1999
through 2000 expenditures denominated in Australian dollars.

     See Note 10 of the Notes to Consolidated Financial Statements for the
year ended December 31, 1998.

6.   SIGNIFICANT ACQUISITIONS AND DISPOSITIONS

     In February 1999, KACC, through a subsidiary, completed the
acquisition of its joint venture partner's 45% interest in Kaiser LaRoche
Hydrate Partners ("KLHP") for a cash purchase price of approximately $10.0. 
As KACC already owned 55% of KLHP, the results of KLHP were already
included in the Company's consolidated financial statements.

     On April 1, 1999, KACC completed the previously announced sale of its
50% interest in AKW L.P. ("AKW"), an aluminum wheels joint venture, to its
partner, Accuride Corporation.  The sale will result in the Company
recognizing a net pre-tax gain of approximately $50 million in the second
quarter of 1999.  The Company's equity in income of AKW was $2.5 and $1.1
for the quarters ended March 31, 1999 and 1998, respectively.

7.   INTERIM OPERATING SEGMENT INFORMATION

     The Company uses a portion of its bauxite, alumina and primary
aluminum production for additional processing at its downstream facilities. 
Transfers between business units are made at estimated market prices.  The
accounting policies of the segments are the same as those described in Note
1 of Notes to Consolidated Financial Statements for the year ended December
31, 1998.  Business unit results are evaluated internally by management
before any allocation of corporate overhead and without any charge for
income taxes or interest expense.  See Note 11 of Notes to Consolidated
Financial Statements for the year ended December 31, 1998.

Financial information by operating segment for the quarters ended March 31,
1999 and 1998 is as follows:

<TABLE>

<CAPTION>
                                                                     Quarter Ended
                                                                       March 31,
                                                            ------------------------------
                                                                      1999            1998
- ------------------------------------------------------------------------------------------
<S>                                                         <C>             <C>
Net Sales:
     Bauxite and Alumina:
          Net sales to unaffiliated customers               $        89.7   $        93.3 
          Intersegment sales                                         23.0            42.2 
                                                            --------------  --------------
                                                                    112.7           135.5 
                                                            --------------  --------------
     Primary Aluminum:
          Net sales to unaffiliated customers                        89.1           126.2 
          Intersegment sales                                         49.1            66.8 
                                                            --------------  --------------
                                                                    138.2           193.0 
                                                            --------------  --------------
     Flat-Rolled Products                                           148.3           194.3 
     Engineered Products                                            133.5           162.6 
     Minority interests                                              18.8            20.6 
     Eliminations                                                   (72.1)         (109.0)
                                                            --------------  --------------
                                                            $       479.4   $       597.0 
                                                            ==============  ==============
Operating income (loss):
     Bauxite and Alumina                                    $        (7.8)  $        11.6 
     Primary Aluminum                                               (22.1)           20.1 
     Flat-Rolled Products                                             7.4            16.3 
     Engineered Products                                              6.9            16.3 
     Micromill                                                       (3.3)           (5.2)
     Eliminations                                                     3.6             3.1 
     Corporate and Other                                            (17.7)          (17.4)
                                                            --------------  --------------
                                                            $       (33.0)  $        44.8 
                                                            ==============  ==============
Depreciation and amortization:
     Bauxite and Alumina                                    $         8.9   $         9.6 
     Primary Aluminum                                                 7.3             7.5 
     Flat-Rolled Products                                             4.1             4.1 
     Engineered Products                                              2.7             2.7 
     Micromill                                                         .7              .7 
     Corporate and Other                                               .7              .8 
                                                            --------------  --------------
                                                            $        24.4   $        25.4 
                                                            ==============  ==============

</TABLE>


     Excluding the February 1999 purchase of the remaining interest in
KLHP, which affected the Bauxite and Alumina segment, and the April 1999
sale of KACC's interest in AKW, which affected the Engineered Products
segment, there were no material changes in segment assets since December
31, 1998.  Capital expenditures made during the first quarter of 1999
(other than the KLHP acquisition) were incurred on a relatively ratable
basis among KACC's four primary operating business segments.

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          ---------------------------------------------------------------
          RESULTS OF OPERATIONS
          ---------------------

     This section should be read in conjunction with the response to Item
1, Part I, of this Report.

     This section contains statements which constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform
Act of 1995.  These statements appear in a number of places in this section
(see, for example, "Recent Events and Developments," "Results of
Operations," and "Liquidity and Capital Resources").  Such statements can
be identified by the use of forward-looking terminology such as "believes,"
"expects," "may," "estimates," "will," "should," "plans" or "anticipates"
or the negative thereof or other variations thereon or comparable
terminology, or by discussions of strategy.  Readers are cautioned that any
such forward-looking statements are not guarantees of future performance
and involve significant risks and uncertainties, and that actual results
may vary materially from those in the forward-looking statements as a
result of various factors.  These factors include the effectiveness of
management's strategies and decisions, general economic and business
conditions, developments in technology, year 2000 technology issues, new or
modified statutory or regulatory requirements, and changing prices and
market conditions.  This section and the Company's Annual Report on Form
10-K for the year ended December 31, 1998, each identify other factors that
could cause such differences.  No assurance can be given that these are all
of the factors that could cause actual results to vary materially from the
forward-looking statements.

RECENT EVENTS AND DEVELOPMENTS

LABOR MATTERS
     Substantially all of KACC's hourly workforce at its Gramercy,
Louisiana, alumina refinery, Mead and Tacoma, Washington, aluminum
smelters, Trentwood, Washington, rolling mill, and Newark, Ohio, extrusion
facility were covered by a master labor agreement with the United
Steelworkers of America (the "USWA") which expired on September 30, 1998. 
The parties did not reach an agreement prior to the expiration of the
master agreement and the USWA chose to strike.  As previously announced, in
January 1999 KACC declined an offer by the USWA to have the striking
workers return to work at the five plants without a new agreement.  KACC
imposed a lock-out to support its bargaining position and continues to
operate the plants with salaried employees and other workers as it has
since the strike began.  Based on operating results to date, the Company
believes that a significant business interruption will not occur.

     KACC and the USWA continue to communicate; however, no formal schedule
for bargaining sessions has been developed at this time.  The objective of
the Company has been, and continues to be, to negotiate a fair labor
contract that is consistent with its business strategy and the commercial
realities of the marketplace.

     As a result of the USWA strike, the Company temporarily curtailed
three out of a total of eleven potlines at its Mead and Tacoma, Washington,
aluminum smelters at September 30, 1998 (representing approximately 70,000
tons of annual production capacity out of a total combined production
capacity of 273,000 tons per year at the facilities.) As previously
announced, in February 1999, KACC began restarting the two curtailed
potlines at its Mead smelter representing approximately 50,000 tons of the
previously idle capacity.  The first of the two Mead potlines was restarted
in March 1999.  The second of the two Mead potlines is currently expected
to commence restart activity during the second quarter of 1999, although it
may not be fully operational until the third quarter of the year.  KACC has
also announced that it has completed preparations to restart the 20,000
tons of idle capacity at its Tacoma smelter. However, the timing for any
restart of the Tacoma potline has yet to be determined and will depend upon
market conditions and other factors.

     While the Company initially experienced an adverse strike-related
impact on its profitability, the Company currently believes that KACC's
operations at the affected facilities have been substantially stabilized
and will be able to run at, or near, full capacity, and that the effect of
the incremental costs associated with operating the affected plants during
the dispute were eliminated or substantially reduced as of January 1999
(excluding the impacts of the restart costs discussed above and the effect
of market factors such as the continued market-related curtailment at the
Tacoma smelter).  However, no assurances can be given that KACC's efforts
to run the plants on a sustained basis, without a significant business
interruption or material adverse impact on the Company's operating results,
will be successful.

STRATEGIC INITIATIVES
     The Company has previously disclosed that it believes that it had met,
and exceeded, its goal of achieving $120.0 million of pre-tax cost
reductions and other profit improvements, independent of metal price
changes, measured against 1996 results prior to the end of the third
quarter of 1998, when the impact of such items as smelter operating levels,
the USWA strike and changes in foreign currency exchange rates are excluded
from the analysis.  The Company remains committed to sustaining the full
$120.0 million improvement and to generating additional profit improvements
in future years; however, no assurances can be given that the Company will
be successful in this regard.

     In addition to working to improve the performance of the Company's
existing assets, the Company has devoted significant efforts analyzing its
existing asset portfolio with the intent of focusing its efforts and
capital in sectors of the industry that are considered most attractive, and
in which the Company believes it is well positioned to capture value.  The
initial steps of this process resulted in the June 1997 acquisition of the
Bellwood extrusion facility, the May 1997 formation of AKW L.P. ("AKW"),
the rationalization of certain of the Company's Engineered Products
operations, the Company's investment to expand its production capacity for
heat treat flat-rolled products at its Trentwood, Washington, rolling mill,
and the Company's fourth quarter 1998 decision to seek a strategic partner
for further development and deployment of KACC's Micromill(TM) technology. 
This process has continued in 1999.  In February 1999, KACC completed the
acquisition of the remaining 45% interest in Kaiser LaRoche Hydrate
Partners ("KLHP"), an alumina marketing venture, from its joint venture
partner for a cash purchase price of approximately $10.0 million.
Additionally, in April 1999, KACC sold its 50% interest in AKW to its joint
venture partner for approximately $70 million in cash proceeds.  The
transaction will result in the Company recognizing a pre-tax gain of
approximately $50 million in the second quarter of 1999.  See Note 6 of
Notes to Interim Consolidated Financial Statements.

     Another area of emphasis has been a continuing focus on managing the
Company's legacy liabilities, including the Company's active pursuit of
claims in respect of insurance coverage for certain incurred and future
environmental costs, as evidenced by the Company's fourth quarter 1998,
receipt of recoveries totaling approximately $35.0 million related to
current and future claims against certain of its insurers.  See Note 9 of
Notes to Consolidated Financial Statements for the year ended December 31,
1998.

     Additional portfolio analysis and initiatives are continuing.

VALCO OPERATING LEVEL
     The Company's 90%-owned Volta Aluminium Company Limited ("Valco")
smelter in Ghana operated only one of its five potlines during most of
1998, although, on average, two potlines were operated during most of the
first quarter of 1998.  Each of Valco's potlines is capable of producing
approximately 40,000 tons of primary aluminum per year.  Valco earned
compensation in 1998 (in the form of energy credits to be utilized over the
last half of 1998 and during 1999) from the Volta River Authority ("VRA")
in lieu of the power necessary to run two of the potlines that were
curtailed during 1998.  The compensation substantially mitigated the
financial impact in 1998 of the curtailment of such lines.  Valco did not
receive any compensation from the VRA for one additional potline which was
curtailed in January 1998.  Valco currently expects to operate an average
of three lines during 1999.  As of April 30, 1999, two of the previously
curtailed potlines had been restarted.

     Valco has notified the VRA that it believes it had the contractual
rights at the beginning of 1998 and 1999 to sufficient energy to run four
and one-half potlines for the balance of both years.  Valco continues to
seek compensation from the VRA with respect to the 1998 and 1999 reductions
in its power allocation.  Valco and the VRA also are in continuing
discussions concerning other matters, including steps that might be taken
to reduce the likelihood of power curtailments in the future.  No
assurances can be given as to the success of these discussions.

RESULTS OF OPERATIONS

     As an integrated aluminum producer, the Company uses a portion of its
bauxite, alumina, and primary aluminum production for additional processing
at certain of its downstream facilities.  Intersegment transfers are valued
at estimated market prices.  The following table provides selected
operational and financial information on a consolidated basis with respect
to the Company for the quarters ended March 31, 1999 and 1998.  The
following data should be read in conjunction with the Company's interim
consolidated financial statements and the notes thereto, contained
elsewhere herein.  See Note 11 of Notes to Consolidated Financial
Statements for the year ended December 31, 1998, for further information
regarding segments.

     Interim results are not necessarily indicative of those for a full
year.

               SELECTED OPERATIONAL AND FINANCIAL INFORMATION
                                (Unaudited)
           (In millions of dollars, except shipments and prices)


<TABLE>

<CAPTION>
                                                                     Quarter Ended
                                                                       March 31,
                                                            ------------------------------
                                                                      1999            1998
- ------------------------------------------------------------------------------------------
<S>                                                         <C>             <C>
Shipments: (000 tons)
     Alumina
          Third Party                                               487.0           424.6 
          Intersegment                                              150.3           215.8 
                                                            --------------  --------------
               Total Alumina                                        637.3           640.4 
                                                            --------------  --------------
     Primary Aluminum
          Third Party                                                62.9            80.5 
          Intersegment                                               39.5            43.6 
                                                            --------------  --------------
               Total Primary Aluminum                               102.4           124.1 
                                                            -------------   -------------
     Flat-Rolled Products                                            52.5            59.7 
                                                            --------------  --------------
     Engineered Products                                             41.4            45.8 
                                                            --------------  --------------
Average Realized Third Party Sales Price: (1)
     Alumina (per ton)                                      $         172   $         201 
     Primary Aluminum (per pound)                           $         .64   $         .71 
Net Sales:
     Bauxite and Alumina
          Third Party (includes net sales of bauxite)       $        89.7   $        93.3 
          Intersegment                                               23.0            42.2 
                                                            --------------  --------------
               Total Bauxite & Alumina                              112.7           135.5 
                                                            --------------  --------------
     Primary Aluminum
          Third Party                                                89.1           126.2 
          Intersegment                                               49.1            66.8 
                                                            --------------  --------------
               Total Primary Aluminum                               138.2           193.0 
                                                            --------------  --------------
     Flat-Rolled Products                                           148.3           194.3 
     Engineered Products                                            133.5           162.6 
     Minority Interests                                              18.8            20.6 
     Eliminations                                                   (72.1)         (109.0)
                                                            --------------  --------------
               Total Net Sales                              $       479.4   $       597.0 
                                                            ==============  ==============
Operating Income (Loss):
     Bauxite & Alumina                                      $        (7.8)  $        11.6 
     Primary Aluminum (2)                                           (22.1)           20.1 
     Flat-Rolled Products                                             7.4            16.3 
     Engineered Products                                              6.9            16.3 
     Micromill(TM)                                                   (3.3)           (5.2)
     Eliminations                                                     3.6             3.1 
     Corporate                                                      (17.7)          (17.4)
                                                            --------------  --------------
               Total Operating Income (Loss)                $       (33.0)  $        44.8 
                                                            ==============  ==============
Net Income (Loss)                                           $       (38.2)  $        12.0 
                                                            ==============  ==============
Capital Expenditures                                        $        16.5   $        13.7 
                                                            ==============  ==============

</TABLE>

(1)  Average realized prices for the Company's Flat-rolled products and
Engineered products segments are not presented as such prices are
subject to fluctuations due to changes in product mix.  Average
realized third party sales prices for  alumina and primary aluminum
include the impact of hedging activities.
(2)  First quarter 1999 results for the Primary aluminum segment include
potline restart costs of $7.1.

OVERVIEW
     The Company's operating results are sensitive to changes in prices of
alumina, primary aluminum, and fabricated aluminum products, and also
depend to a significant degree on the volume and mix of all products sold
and on KACC's hedging strategies.  Primary aluminum prices have
historically been subject to significant cyclical price fluctuations.  See
Note 5 of Notes to Interim Consolidated Financial Statements for a
discussion of KACC's hedging activities.

     During 1998, the Average Midwest United States transaction price ("AMT
Price") per pound of primary aluminum experienced a steady decline during
the year, beginning the year in the $.70 to $.75 range and ending the year
in the low $.60 range.  During the first quarter of 1999, the AMT Price for
primary aluminum was in the $.57 to $.59 per pound range most of the
quarter, but increased in March 1999 and ended the quarter at approximately
$.62.  The AMT Price for primary aluminum for the week ended April 23,
1999, was approximately $.64 per pound.

QUARTER ENDED MARCH 31, 1999, COMPARED TO QUARTER ENDED MARCH 31, 1998

SUMMARY
     The Company reported a net loss of $38.2 million, or $.48 of basic
loss per share, for the first quarter of 1999, compared to a net income of
$12.0 million, or $.15 of basic earnings per share, for the same period of
1998. Net sales in the first quarter of 1999 totaled $479.4 million
compared to $597.0 million in the first quarter of 1998.

BAUXITE AND ALUMINA
     Third party net sales of alumina were down 2% for the quarter ended
March 31, 1999, as compared to the same period in 1998 as a 15% increase in
third party shipments was more than offset by a decline in average realized
price. The increase in 1999 third party shipments (and offsetting decrease
in 1999 intersegment shipments) resulted from reduced shipments to Valco,
due to the production curtailment more fully discussed above and the fourth
quarter strike-related curtailment of three potlines at the Company's
Washington smelters.  The average realized price for third party alumina
sales was down as the allocated net gains from the Company's hedging
activities only partially offset the decline in market prices related to
the Company's primary aluminum-linked customer sales contracts.  In
addition to being impacted by the reduced shipments to Valco and the
Washington smelters as discussed above, intersegment sales were adversely
affected by a substantial market-related decline in intersegment average
sales prices.

     Segment operating income declined significantly between years due to
the decline in market related prices discussed above.  The impact of
increased third party shipments of alumina was substantially offset by a
corresponding decline in intersegment shipments.

PRIMARY ALUMINUM
     First quarter 1999 third party net sales of primary aluminum were down
29% as compared to the comparable period in 1998 primarily as a result of a
22% reduction in shipments, caused by the 1998 potline curtailments at
Valco and the Washington smelters.  Reduced average realized third party
sales prices between first quarter 1999 and 1998 (reflecting lower market
prices offset, in part, by allocated net gains from KACC's hedging
activities) also adversely impacted third party net sales.  Intersegment
net sales were down approximately 27% between first quarter 1999 and 1998.
Intersegment shipments were down 9% from the prior year comparable period
and average realized prices dropped by 18% reflecting lower market prices
for primary aluminum.

     Segment operating income in first quarter 1999 was down significantly
from first quarter 1998.  The primary reason for the decline was the
significant reduction in shipments and average realized prices, discussed
above.  However, first quarter 1999 results also reflect the adverse impact
of the Valco and Washington smelter potline curtailments, the lack of any
compensation from the VRA in 1999 related to the Valco potline
curtailments, and costs of approximately $7.1 million associated with
preparing and restarting potlines at Valco and the Washington smelters.

FLAT-ROLLED PRODUCTS
     Net sales of flat-rolled products decreased by 24% during first
quarter 1999 as compared to 1998 as a result of a 12% reduction in product
shipments and 13% decline in average realized prices.  The reduction in
quarterly shipments reflects reduced aerospace demand for heat treat
products as compared to the first quarter of 1998 as well as customer
deferrals of can stock purchases into the second quarter of 1999.  The
decline in average realized prices reflects lower market prices for primary
aluminum as well as the price impact of the changes in product mix
discussed above.

     Segment operating income decreased significantly in first quarter 1999
primarily as a result of the price, volume and product mix factors
discussed above.

ENGINEERED PRODUCTS
     Net sales of engineered products were down approximately 18% year to
year, reflecting a 10% decrease in product shipments and 9% decline in
average realized prices.  The reduction in shipments primarily resulted
from seasonality and softening demand primarily in aerospace market
sectors.  These factors were somewhat offset by strong demand for soft
alloy extrusions.  The change in average realized prices reflects lower
market prices for primary aluminum as well as the price impact of changes
in product mix.

     Segment operating income declined significantly in the first quarter
of 1999 as compared to the first quarter of 1998 primarily as a result of
the price, volume, and product mix factors discussed above.

ELIMINATIONS
     Eliminations of intersegment profit vary from period to period
depending on fluctuations in market prices as well as the amount and timing
of the affected segments' production and sales.

CORPORATE AND OTHER
     Corporate operating expenses represent corporate general and
administrative expenses which are not allocated to the Company's business
segments.

LIQUIDITY AND CAPITAL RESOURCES

OPERATING ACTIVITIES
     At March 31, 1999, the Company had working capital of $379.7 million,
compared with working capital of $471.6 million at December 31, 1998.  The
decrease in working capital primarily resulted from a decrease in Cash and
cash equivalents.

INVESTING ACTIVITIES
     Capital expenditures during the quarter ended March 31, 1999, were
$16.5 million consisting primarily of the purchase of the remaining 45%
interest in KLHP, discussed above.  The remainder of the first quarter 1999
capital expenditures were used to improve production efficiency and reduce
operating costs.  Total consolidated capital expenditures (of which
approximately 8% is expected to be funded by the Company's minority
partners in certain foreign joint ventures) are expected to be between $70
and $90 million per annum in each of 1999 through 2001.  Management
continues to evaluate numerous projects all of which would require
substantial capital, both in the United States and overseas.  The level of
capital expenditures may be adjusted from time to time depending on the
Company's price outlook for primary aluminum and other products, KACC's
ability to assure future cash flows through hedging or other means, the
Company's financial position and other factors.

FINANCING ACTIVITIES AND LIQUIDITY

     At March 31, 1999, the Company had long-term debt of $962.7 million,
compared with $963.0 million at December 31, 1998.

     At March 31, 1999, $273.4 million (of which $73.4 million could have
been used for letters of credit) was available to KACC under the Credit
Agreement and no amounts were outstanding under the revolving credit
facility. Loans under the Credit Agreement bear interest at a spread (which
varies based on the results of a financial test) over either a base rate or
LIBOR at the Company's option.

     Management believes that the Company's existing cash resources,
together with cash flows from operations and borrowings under the Credit
Agreement, will be sufficient to meet its working capital and capital
expenditure requirements for the next year.  Additionally, with respect to
long-term liquidity, management believes that operating cash flow, together
with the ability to obtain both short and long-term financing, should
provide sufficient funds to meet the Company's working capital and capital
expenditure requirements.

CAPITAL STRUCTURE
     MAXXAM Inc. ("MAXXAM") and one of its wholly owned subsidiaries
collectively own approximately 63% of the Company's Common Stock, with the
remaining approximately 37% of the Company's Common Stock being publicly
held.  Certain of the shares of the Company's Common Stock beneficially
owned by MAXXAM are subject to certain pledge agreements by MAXXAM and its
subsidiary.

     The Company has an effective "shelf" registration statement covering
the offering from time to time of up to $150.0 million of equity
securities.  Any such offering will only be made by means of a prospectus. 
The Company also has an effective "shelf" registration statement covering
the offering of up to 10,000,000 shares of the Company's Common Stock that
are owned by MAXXAM.  The Company will not receive any of the net proceeds
from any transaction initiated by MAXXAM pursuant to this registration
statement.

     The Credit Agreement does not permit the Company or KACC to pay any
dividends on their common stock.

OTHER MATTERS

YEAR 2000 READINESS DISCLOSURE
     The Company utilizes software and related technologies throughout its
business that will be affected by the date change to the year 2000.  There
may also be technology embedded in certain of the equipment owned or used
by the Company that is susceptible to the year 2000 date change as well. 
The Company has implemented a company-wide program to coordinate the year
2000 efforts of its individual business units and to track their progress. 
The intent of the program is to make sure that critical items are
identified on a sufficiently timely basis to assure that the necessary
resources can be committed to address any material risk areas that could
prevent the Company's systems and assets from being able to meet the
Company's business needs and objectives.  Year 2000 progress and readiness
has also been the subject of the Company's normal, recurring internal audit
function.

     Each of the Company's business units has developed year 2000 plans
specifically tailored to their individual situations.  A wide range of
solutions is being implemented, including modifying existing systems and,
in limited cases where it is cost effective, purchasing new systems.  Total
spending related to these projects, which began in 1997 and is expected to
continue through 1999, is currently estimated to be in the $10-15 million
range. As of April 30, 1999, the Company estimates that approximately $4-6
million of year 2000 expenditures are yet to be incurred.  Such remaining
amounts are expected to be incurred over the balance of 1999, primarily in
the second and third quarters of the year. System modification costs are
being expensed as incurred.  Costs associated with new systems are being
capitalized and will be amortized over the life of the system.  The Company
has established an internal goal of having all necessary system changes in
place and tested by mid-year 1999.  Substantially all facilities and
systems are expected to meet this goal.  However, a limited number of
systems and pieces of equipment will not be completely remediated and
tested until sometime in the third quarter of the year.  The Company plans
to commit the necessary resources for all remediation efforts.

     In addition to addressing the Company's internal systems, the company-
wide program involves identification of key suppliers, customers, and other
third-party relationships that could be impacted by year 2000 issues.  A
general survey has been conducted of the Company's supplier and customer
base.  Direct contact has been made, or is in progress, with parties which
are deemed to be particularly critical including financial institutions,
power suppliers, and customers, with which the Company has a material
relationship.

     Each business unit, including the corporate group, is developing a
contingency plan covering the steps that would be taken if a year 2000
problem were to occur despite the Company's best efforts to identify and
remediate all critical at-risk items.  Each contingency plan will address,
among other things, matters such as alternative suppliers for critical
inputs, incremental standby labor requirements at the millennium to address
any problems as they occur, and backup processing capabilities for critical
equipment or processes.  The goal of the contingency plans will be to
minimize any business interruptions and the associated financial
implications.

     While the Company believes that its program is sufficient to identify
the critical issues and associated costs necessary to address possible year
2000 problems in a timely manner, there can be no assurances that the
program, or underlying steps implemented, will be successful in resolving
all such issues by the Company's mid-1999 goal or prior to the year 2000. 
If the steps taken by the Company (or critical third parties) are not made
in a timely manner, or are not successful in identifying and remediating
all significant year 2000 issues, business interruptions or delays could
occur and could have a material adverse impact on the Company's results and
financial condition.  However, based on the information the Company has
gathered to date and the Company's expectations of its ability to remediate
problems encountered, the Company currently believes that significant
business interruptions that would have a material impact on the Company's
results or financial condition will not be encountered.

ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
          ----------------------------------------------------------

     See Part I, Item 7A. "QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT
MARKET RISK" in the Company's Form 10-K for the year ended December 31,
1998.

                        PART II - OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS
          -----------------

Asbestos-related Litigation

     KACC is a defendant in a number of lawsuits, some of which involve
claims of multiple persons, in which the plaintiffs allege that certain of
their injuries were caused by, among other things, exposure to asbestos
during, and as a result of, their employment or association with KACC or
exposure to products containing asbestos produced or sold by KACC.  The
portion of Note 4 of Notes to Interim Consolidated Financial Statements
contained in this report under the heading "Asbestos Contingencies" is
incorporated herein by reference.  See Part I, Item 3. "LEGAL PROCEEDINGS -
Asbestos-related Litigation" in the Company's Form 10-K for the year ended
December 31, 1998.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K
          --------------------------------

     (a)  Exhibits.

     Exhibit No.    Exhibit
     ----------     -------

      3.1 Restated Certificate of Incorporation of Kaiser Aluminum
          Corporation (the "Company" or "KAC"), dated February 21, 1991
          (incorporated by reference to Exhibit 3.1 to Amendment No. 2 to
          the Registration Statement on Form S-1, dated June 11, 1991,
          filed by KAC, Registration No. 33-37895).

      3.2 Certificate of Retirement of KAC, dated October 24, 1995
          (incorporated by reference to Exhibit 3.2 to the Report on Form
          10-K for the period ended December 31, 1995, filed by KAC, File
          No. 1-9447).

      3.3 Certificate of Retirement of KAC, dated February 12, 1998
          (incorporated by reference to Exhibit 3.3 to the Report on Form
          10-K for the period ended December 31, 1997, filed by KAC, File
          No. 1-9447).

      3.4 Amended and Restated Bylaws of KAC, dated October 1, 1997
          (incorporated by reference to Exhibit 3.3 to the Report on Form
          10-Q for the quarterly period ended September 30, 1997, filed by
          KAC, File No. 1-9447).

     *4.1 Fourth Supplemental Indenture, dated as of March 31, 1999, to the
          Indenture, dated as of February 1, 1993, regarding KACC's 12-3/4%
          Senior Subordinated Notes due 2003.

     *4.2 Third Supplemental Indenture, dated as of March 31, 1999, to the
          Indenture, dated as of February 17, 1994, regarding KACC's 9-7/8%
          Senior Notes due 2002.

     *4.3 Second Supplemental Indenture, dated as of March 31, 1999, to the
          Indenture, dated as of October 23, 1996, regarding KACC's 10-7/8%
          Series B Senior Notes due 2006.

     *4.4 Second Supplemental Indenture, dated as of March 31, 1999, to the
          Indenture, dated as of December 23, 1996, regarding KACC's
          10-7/8% Series D Senior Notes due 2006.

     *27  Financial Data Schedule.

     (b)  Reports on Form 8-K.

     No Report on Form 8-K was filed by the Company during the quarter
ended March 31, 1999.


- ---------------
*    Filed herewith

                                 SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized, who have signed this report on
behalf of the registrant as the principal financial officer and principal
accounting officer of the registrant, respectively.

                                        KAISER ALUMINUM CORPORATION


                                             /s/   John T. La Duc
                                        By:-----------------------------
                                                   John T. La Duc
                                           Executive Vice President and 
                                              Chief Financial Officer
                                           (Principal Financial Officer)


                                             /s/     Daniel D. Maddox
                                        By:-----------------------------
                                                  Daniel D. Maddox
                                           Vice President and Controller
                                           (Principal Accounting Officer)



Dated:    May 7, 1999







- ---------------------------------------------------------------------------


             KAISER ALUMINUM & CHEMICAL CORPORATION, as Issuer,
                                      
                   KAISER ALUMINA AUSTRALIA CORPORATION,
                            ALPART JAMAICA INC.,
                        KAISER JAMAICA CORPORATION,
                        KAISER FINANCE CORPORATION,
                      KAISER MICROMILL HOLDINGS, LLC,
                       KAISER SIERRA MICROMILLS, LLC,
                    KAISER TEXAS SIERRA MICROMILLS, LLC,
                   KAISER TEXAS MICROMILL HOLDINGS, LLC,
                      KAISER BELLWOOD CORPORATION, and
                        KAISER TRANSACTION CORP., as
                           Subsidiary Guarantors

                                    and

              STATE STREET BANK AND TRUST COMPANY, as Trustee
                                      
                                      
                       FOURTH SUPPLEMENTAL INDENTURE

                         Dated as of March 31, 1999

                                     to

                                 INDENTURE

                        Dated as of February 1, 1993
                                      
                                      
                                      
                 12-3/4% Senior Subordinated Notes due 2003

- ---------------------------------------------------------------------------
          FOURTH SUPPLEMENTAL INDENTURE, dated as of March 31, 1999, among
KAISER ALUMINUM & CHEMICAL CORPORATION, a Delaware corporation (the
"Company"), as Issuer, KAISER ALUMINA AUSTRALIA CORPORATION, a Delaware
corporation ("KAAC"), ALPART JAMAICA INC., a Delaware corporation ("AJI"),
KAISER JAMAICA CORPORATION, a Delaware corporation ("KJC"), KAISER FINANCE
CORPORATION, a Delaware corporation ("Kaiser Finance"), KAISER MICROMILL
HOLDINGS, LLC, a Delaware limited liability company ("KMH"), KAISER SIERRA
MICROMILLS, LLC, a Delaware limited liability company ("KSM"), KAISER TEXAS
SIERRA MICROMILLS, LLC, a Texas limited liability company ("Texas Sierra"),
KAISER TEXAS MICROMILL HOLDINGS, LLC, a Texas limited liability company
("Texas Holdings"), KAISER BELLWOOD CORPORATION, a Delaware corporation
("Kaiser Bellwood"), and KAISER TRANSACTION CORP., a Delaware corporation
("Kaiser Transaction"), as Subsidiary Guarantors, and State Street Bank and
Trust Company (as successor to The First National Bank of Boston), a
Massachusetts trust company, as Trustee (the "Trustee").

          WHEREAS, the Company, KAAC, AJI, KJC and The First National Bank
of Boston executed an Indenture, dated as of February 1, 1993 (the
"Original Indenture"), in respect of $400,000,000 aggregate principal
amount of the Company's 12-3/4% Senior Subordinated Notes due 2003 (the
"Securities"), and the Original Indenture was amended by a First
Supplemental Indenture, dated as of May 1, 1993, by a Second Supplemental
Indenture, dated as of February 1, 1996, and by a Third Supplemental
Indenture, dated as of July 15, 1997 (the Original Indenture, as amended by
such First Supplemental Indenture, Second Supplemental Indenture, and Third
Supplemental Indenture being hereinafter referred to as the "Indenture");
and

          WHEREAS, State Street Bank and Trust Company is the successor to
The First National Bank of Boston, as Trustee under the Indenture; and

          WHEREAS, Section 5.12 of the Indenture requires, under
circumstances specified in Section 5.12, that the Company shall cause
certain Subsidiaries of the Company to execute and deliver to the Trustee a
supplemental indenture in form and substance satisfactory to the Trustee
pursuant to which such Subsidiaries of the Company shall be named as
additional Subsidiary Guarantors; and

          WHEREAS, all conditions and requirements necessary to make this
Fourth Supplemental Indenture a valid, binding and legal instrument in
accordance with its terms have been performed and fulfilled and the
execution and delivery hereof have been in all respects duly authorized;

          NOW, THEREFORE, in consideration of the above premises, each
party agrees, for the benefit of the other and for the equal and ratable
benefit of the Holders of the Securities, as follows:

                                 ARTICLE I

                                 AMENDMENTS

          Section 1.  The Company, KAAC, AJI, KJC, Kaiser Finance, KMH,
KSM, Texas Sierra, Texas Holdings, Kaiser Bellwood, Kaiser Transaction and
the Trustee hereby amend the Indenture and agree that Kaiser Transaction
shall be a Subsidiary Guarantor for all purposes under the Indenture and
the term "Subsidiary Guarantor" shall for all purposes under the Indenture
specifically include Kaiser Transaction.



                                 ARTICLE II

                          MISCELLANEOUS PROVISIONS

          Section 2.1.  Terms Defined.  For all purposes of this Fourth
Supplemental Indenture, except as otherwise defined or unless the context
otherwise requires, terms used in capitalized form in this Fourth
Supplemental Indenture and defined in the Indenture have the meanings
specified in the Indenture.

          Section 2.2.  Indenture.  Except as amended hereby, the Indenture
and the Securities are in all respects ratified and confirmed and all their
terms shall remain in full force and effect.

          Section 2.3.  Governing Law.  This Fourth Supplemental Indenture
shall be deemed to be a contract made under the laws of the State of New
York, and for all purposes shall be governed by and construed in accordance
with the laws of said state without regard to the principles of the
conflict of laws provisions thereof.

          Section 2.4.  Successors and Assigns.  All agreements of the
Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas
Holdings, Kaiser Bellwood, and Kaiser Transaction in this Fourth
Supplemental Indenture and the Securities shall bind its successors and
assigns.

          Section 2.5.  Multiple Counterparts.  This Fourth Supplemental
Indenture may be executed in any number of counterparts, each of which
shall be an original; but such counterparts shall together constitute but
one and the same instrument.

          Section 2.6.  Effectiveness.  The provisions of this Fourth
Supplemental Indenture shall become effective immediately upon its
execution and delivery by the Trustee in accordance with the provisions of
Article Eleven of the Indenture.

          Section 2.7.  Trustee Disclaimer.  The Trustee accepts the
amendment of the Indenture effected by this Fourth Supplemental Indenture
and agrees to execute the trust created by the Indenture as hereby amended,
but only upon the terms and conditions set forth in the Indenture,
including the terms and provisions defining and limiting the liabilities
and responsibilities of the Trustee, which terms and provisions shall in
like manner define and limit its liabilities and responsibilities in the
performance of the trust created by the Indenture as hereby amended, and,
without limiting the generality of the foregoing, the Trustee shall not be
responsible in any manner whatsoever for or with respect to any of the
recitals or statements contained herein, all of which recitals or
statements are made solely by the Company, KAAC, AJI, KJC, Kaiser Finance,
KMH, KSM, Texas Sierra, Texas Holdings, Kaiser Bellwood, and Kaiser
Transaction, or for or with respect to (i) the validity, efficacy or
sufficiency of this Fourth Supplemental Indenture or any of the terms or
provisions hereof, (ii) the proper authorization hereof by the Company,
KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas Holdings,
Kaiser Bellwood, and Kaiser Transaction by corporate action or limited
liability company action or otherwise, (iii) the due execution hereof by
the Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas
Holdings, Kaiser Bellwood, and Kaiser Transaction, or (iv) the consequences
(direct or indirect and whether deliberate or inadvertent) of any amendment
herein provided for, and the Trustee makes no representation with respect
to any such matters.


                                 SIGNATURES
          IN WITNESS WHEREOF, the parties hereto have caused this Fourth
Supplemental Indenture to be duly executed, all as of the date first
written above.


                                   KAISER ALUMINUM & CHEMICAL
                                   CORPORATION, as Issuer



                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:    /s/      John Wm. Niemand II                            
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER ALUMINA AUSTRALIA
                                   CORPORATION, as a Subsidiary Guarantor



                                   By:       /s/  Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:         /s/ John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   ALPART JAMAICA INC., as a
                                   Subsidiary Guarantor
                                   By:       /s/  Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:       /s/   John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary



                                   KAISER JAMAICA CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:        /s/ Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:       /s/   John Wm. Niemand II                         
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER FINANCE CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:       /s/  Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER MICROMILL HOLDINGS, LLC,
                                   as a Subsidiary Guarantor



                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary



                                   KAISER SIERRA MICROMILLS, LLC,
                                   as a Subsidiary Guarantor



                                   By:       /s/  Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:       /s/   John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER TEXAS SIERRA MICROMILLS,
                                   LLC, as a Subsidiary Guarantor



                                   By:       /s/  Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER TEXAS MICROMILL HOLDINGS,
                                   LLC, as a Subsidiary Guarantor



                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER BELLWOOD CORPORATION,
                                   as a Subsidiary Guarantor


                                   By:       /s/  Karen A.Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER TRANSACTION CORP.,
                                   as a Subsidiary Guarantor



                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   STATE STREET BANK AND TRUST
                                   COMPANY, as Trustee



                                   By:                                     
                                        -----------------------------------

                                   Name:                                   
                                        -----------------------------------

                                   Title:                                  
                                        -----------------------------------

Dated:  March 31, 1999

Attest:                                 
          ------------------------------

          Name:                         
               -------------------------

          Title:                        
               -------------------------











- ---------------------------------------------------------------------------


             KAISER ALUMINUM & CHEMICAL CORPORATION, as Issuer,
                                      
                   KAISER ALUMINA AUSTRALIA CORPORATION,
                            ALPART JAMAICA INC.,
                        KAISER JAMAICA CORPORATION,
                        KAISER FINANCE CORPORATION,
                      KAISER MICROMILL HOLDINGS, LLC,
                       KAISER SIERRA MICROMILLS, LLC,
                    KAISER TEXAS SIERRA MICROMILLS, LLC,
                   KAISER TEXAS MICROMILL HOLDINGS, LLC,
                      KAISER BELLWOOD CORPORATION, and
                        KAISER TRANSACTION CORP., as
                           Subsidiary Guarantors

                                    and

              U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
                                      
                                      
                        THIRD SUPPLEMENTAL INDENTURE

                         Dated as of March 31, 1999

                                     to

                                 INDENTURE

                       Dated as of February 17, 1994
                                      
                                      
                                      
                        9-7/8% Senior Notes due 2002

- ---------------------------------------------------------------------------
          THIRD SUPPLEMENTAL INDENTURE, dated as of March 31, 1999, among
KAISER ALUMINUM & CHEMICAL CORPORATION, a Delaware corporation (the
"Company"), as Issuer, KAISER ALUMINA AUSTRALIA CORPORATION, a Delaware
corporation ("KAAC"), ALPART JAMAICA INC., a Delaware corporation ("AJI"),
KAISER JAMAICA CORPORATION, a Delaware corporation ("KJC"), KAISER FINANCE
CORPORATION, a Delaware corporation ("Kaiser Finance"), KAISER MICROMILL
HOLDINGS, LLC, a Delaware limited liability company ("KMH"), KAISER SIERRA
MICROMILLS, LLC, a Delaware limited liability company ("KSM"), KAISER TEXAS
SIERRA MICROMILLS, LLC, a Texas limited liability company ("Texas Sierra"),
KAISER TEXAS MICROMILL HOLDINGS, LLC, a Texas limited liability company
("Texas Holdings"), KAISER BELLWOOD CORPORATION, a Delaware corporation
("Kaiser Bellwood"), and KAISER TRANSACTION CORP., a Delaware corporation
("Kaiser Transaction"), as Subsidiary Guarantors, and U.S. Bank Trust
National Association (formerly known as First Trust National Association),
a national banking association, as Trustee (the "Trustee").

          WHEREAS, the Company, KAAC, AJI, KJC, Kaiser Finance, and the
Trustee executed an Indenture, dated as of February 17, 1994 (the "Original
Indenture"), in respect of $225,000,000 aggregate principal amount of the
Company's 9-7/8% Senior Notes due 2002 (the "Securities"), and the Original
Indenture was amended by a First Supplemental Indenture, dated as of
February 1, 1996, and by a Second Supplemental Indenture, dated as of July
15, 1997 (the Original Indenture, as amended by such First Supplemental
Indenture and Second Supplemental Indenture being hereinafter referred to
as the "Indenture"); and

          WHEREAS, Section 4.12 of the Indenture requires, under
circumstances specified in Section 4.12, that the Company shall cause
certain Subsidiaries of the Company to execute and deliver to the Trustee a
supplemental indenture in form and substance satisfactory to the Trustee
pursuant to which such Subsidiaries of the Company shall be named as
additional Subsidiary Guarantors; and

          WHEREAS, all conditions and requirements necessary to make this
Third Supplemental Indenture a valid, binding and legal instrument in
accordance with its terms have been performed and fulfilled and the
execution and delivery hereof have been in all respects duly authorized;

          NOW, THEREFORE, in consideration of the above premises, each
party agrees, for the benefit of the other and for the equal and ratable
benefit of the Holders of the Securities, as follows:

                                 ARTICLE I
                                      
                                 AMENDMENTS
                                      
          Section 1.  The Company, KAAC, AJI, KJC, Kaiser Finance, KMH,
KSM, Texas Sierra, Texas Holdings, Kaiser Bellwood, Kaiser Transaction and
the Trustee hereby amend the Indenture and agree that Kaiser Transaction
shall be a Subsidiary Guarantor for all purposes under the Indenture and
the term "Subsidiary Guarantor" shall for all purposes under the Indenture
specifically include Kaiser Transaction.


                                 ARTICLE II

                          MISCELLANEOUS PROVISIONS

          Section 2.1.  Terms Defined.  For all purposes of this Third
Supplemental Indenture, except as otherwise defined or unless the context
otherwise requires, terms used in capitalized form in this Third
Supplemental Indenture and defined in the Indenture have the meanings
specified in the Indenture.

          Section 2.2.  Indenture.  Except as amended hereby, the Indenture
and the Securities are in all respects ratified and confirmed and all their
terms shall remain in full force and effect.

          Section 2.3.  Governing Law.  This Third Supplemental Indenture
shall be deemed to be a contract made under the laws of the State of New
York, and for all purposes shall be governed by and construed in accordance
with the laws of said state without regard to the principles of the
conflict of laws provisions thereof.

          Section 2.4.  Successors and Assigns.  All agreements of the
Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas
Holdings, Kaiser Bellwood, and Kaiser Transaction in this Third
Supplemental Indenture and the Securities shall bind its successors and
assigns.

          Section 2.5.  Multiple Counterparts.  This Third Supplemental
Indenture may be executed in any number of counterparts, each of which
shall be an original; but such counterparts shall together constitute but
one and the same instrument.

          Section 2.6.  Effectiveness.  The provisions of this Third
Supplemental Indenture shall become effective immediately upon its
execution and delivery by the Trustee in accordance with the provisions of
Article Ten of the Indenture.

          Section 2.7.  Trustee Disclaimer.  The Trustee accepts the
amendment of the Indenture effected by this Third Supplemental Indenture
and agrees to execute the trust created by the Indenture as hereby amended,
but only upon the terms and conditions set forth in the Indenture,
including the terms and provisions defining and limiting the liabilities
and responsibilities of the Trustee, which terms and provisions shall in
like manner define and limit its liabilities and responsibilities in the
performance of the trust created by the Indenture as hereby amended, and,
without limiting the generality of the foregoing, the Trustee shall not be
responsible in any manner whatsoever for or with respect to any of the
recitals or statements contained herein, all of which recitals or
statements are made solely by the Company, KAAC, AJI, KJC, Kaiser Finance,
KMH, KSM, Texas Sierra, Texas Holdings, Kaiser Bellwood, and Kaiser
Transaction or for or with respect to (i) the validity, efficacy or
sufficiency of this Third Supplemental Indenture or any of the terms or
provisions hereof, (ii) the proper authorization hereof by the Company,
KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas Holdings,
Kaiser Bellwood, and Kaiser Transaction by corporate action or limited
liability company action or otherwise, (iii) the due execution hereof by
the Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas
Holdings, Kaiser Bellwood, and Kaiser Transaction, or (iv) the consequences
(direct or indirect and whether deliberate or inadvertent) of any amendment
herein provided for, and the Trustee makes no representation with respect
to any such matters.


                                 SIGNATURES

          IN WITNESS WHEREOF, the parties hereto have caused this Third
Supplemental Indenture to be duly executed, all as of the date first
written above.


                                   KAISER ALUMINUM & CHEMICAL
                                   CORPORATION, as Issuer
                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER ALUMINA AUSTRALIA
                                   CORPORATION, as a Subsidiary Guarantor



                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   ALPART JAMAICA INC., as a
                                   Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER JAMAICA CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER FINANCE CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:    /s/      John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER MICROMILL HOLDINGS, LLC,
                                   as a Subsidiary Guarantor



                                   By:    /s/     Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:    /s/      John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary



                                   KAISER SIERRA MICROMILLS, LLC,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER TEXAS SIERRA MICROMILLS,
                                   LLC, as a Subsidiary Guarantor

                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:    /s/      John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER TEXAS MICROMILL HOLDINGS,
                                   LLC, as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:    /s/      John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary



                                   KAISER BELLWOOD CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell 
                                        ----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER TRANSACTION CORP.,
                                   as a Subsidiary Guarantor



                                   By:    /s/     Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   U.S. BANK TRUST NATIONAL
                                   ASSOCIATION, as Trustee



                                   By:
                                        ------------------------------

                                   Name:
                                        ------------------------------

                                   Title:
                                        ------------------------------

Dated:  March 31, 1999

Attest:                                 
     -----------------------------------

          Name:                         
               -------------------------

          Title:                        
               -------------------------










- ---------------------------------------------------------------------------


             KAISER ALUMINUM & CHEMICAL CORPORATION, as Issuer,
                                      
                   KAISER ALUMINA AUSTRALIA CORPORATION,
                            ALPART JAMAICA INC.,
                        KAISER JAMAICA CORPORATION,
                        KAISER FINANCE CORPORATION,
                      KAISER MICROMILL HOLDINGS, LLC,
                       KAISER SIERRA MICROMILLS, LLC,
                    KAISER TEXAS SIERRA MICROMILLS, LLC,
                   KAISER TEXAS MICROMILL HOLDINGS, LLC,
                      KAISER BELLWOOD CORPORATION, and
                        KAISER TRANSACTION CORP., as
                           Subsidiary Guarantors

                                    and

              U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
                                      
                                      
                       SECOND SUPPLEMENTAL INDENTURE

                         Dated as of March 31, 1999

                                     to

                                 INDENTURE

                        Dated as of October 23, 1996
                                      
                                      
                                      
                   10-7/8% Series B Senior Notes due 2006

- ---------------------------------------------------------------------------
          SECOND SUPPLEMENTAL INDENTURE, dated as of March 31, 1999, among
KAISER ALUMINUM & CHEMICAL CORPORATION, a Delaware corporation (the
"Company"), as Issuer, KAISER ALUMINA AUSTRALIA CORPORATION, a Delaware
corporation ("KAAC"), ALPART JAMAICA INC., a Delaware corporation ("AJI"),
KAISER JAMAICA CORPORATION, a Delaware corporation ("KJC"), KAISER FINANCE
CORPORATION, a Delaware corporation ("Kaiser Finance"), KAISER MICROMILL
HOLDINGS, LLC, a Delaware limited liability company ("KMH"), KAISER SIERRA
MICROMILLS, LLC, a Delaware limited liability company ("KSM"), KAISER TEXAS
SIERRA MICROMILLS, LLC, a Texas limited liability company ("Texas Sierra"),
KAISER TEXAS MICROMILL HOLDINGS, LLC, a Texas limited liability company
("Texas Holdings"), KAISER BELLWOOD CORPORATION, a Delaware corporation
("Kaiser Bellwood"), and KAISER TRANSACTION CORP., a Delaware corporation
("Kaiser Transaction"), as Subsidiary Guarantors, and U.S. Bank Trust
National Association (formerly known as First Trust National Association),
a national banking association, as Trustee (the "Trustee").

          WHEREAS, the Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM,
Texas Sierra, Texas Holdings, and the Trustee executed an Indenture, dated
as of October 23, 1996 (the "Original Indenture"), in respect of
$175,000,000 aggregate principal amount of the Company's 10-7/8% Series B
Senior Notes due 2006 (the "Securities"), and the Original Indenture was
amended by a First Supplemental Indenture, dated as of July 15, 1997 (the
Original Indenture, as amended by such First Supplemental Indenture
hereinafter referred to as the "Indenture"); and

          WHEREAS, Section 4.12 of the Indenture requires, under
circumstances specified in Section 4.12, that the Company shall cause
certain Subsidiaries of the Company to execute and deliver to the Trustee a
supplemental indenture in form and substance satisfactory to the Trustee
pursuant to which such Subsidiaries of the Company shall be named as
additional Subsidiary Guarantors; and

          WHEREAS, all conditions and requirements necessary to make this
Second Supplemental Indenture a valid, binding and legal instrument in
accordance with its terms have been performed and fulfilled and the
execution and delivery hereof have been in all respects duly authorized;

          NOW, THEREFORE, in consideration of the above premises, each
party agrees, for the benefit of the other and for the equal and ratable
benefit of the Holders of the Securities, as follows:

                                 ARTICLE I
                                      
                                 AMENDMENTS
                                      
          Section 1.  The Company, KAAC, AJI, KJC, Kaiser Finance, KMH,
KSM, Texas Sierra, Texas Holdings, Kaiser Bellwood, Kaiser Transaction, and
the Trustee hereby amend the Indenture and agree that Kaiser Transaction
shall be a Subsidiary Guarantor for all purposes under the Indenture and
the term "Subsidiary Guarantor" shall for all purposes under the Indenture
specifically include Kaiser Transaction.


                                 ARTICLE II

                          MISCELLANEOUS PROVISIONS

          Section 2.1.  Terms Defined.  For all purposes of this Second
Supplemental Indenture, except as otherwise defined or unless the context
otherwise requires, terms used in capitalized form in this Second
Supplemental Indenture and defined in the Indenture have the meanings
specified in the Indenture.

          Section 2.2.  Indenture.  Except as amended hereby, the Indenture
and the Securities are in all respects ratified and confirmed and all their
terms shall remain in full force and effect.

          Section 2.3.  Governing Law.  This Second Supplemental Indenture
shall be deemed to be a contract made under the laws of the State of New
York, and for all purposes shall be governed by and construed in accordance
with the laws of said state without regard to the principles of the
conflict of laws provisions thereof.

          Section 2.4.  Successors and Assigns.  All agreements of the
Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas
Holdings, Kaiser Bellwood, and Kaiser Transaction in this Second
Supplemental Indenture and the Securities shall bind its successors and
assigns.

          Section 2.5.  Multiple Counterparts.  This Second Supplemental
Indenture may be executed in any number of counterparts, each of which
shall be an original; but such counterparts shall together constitute but
one and the same instrument.

          Section 2.6.  Effectiveness.  The provisions of this Second
Supplemental Indenture shall become effective immediately upon its
execution and delivery by the Trustee in accordance with the provisions of
Article Ten of the Indenture.

          Section 2.7.  Trustee Disclaimer.  The Trustee accepts the
amendment of the Indenture effected by this Second Supplemental Indenture
and agrees to execute the trust created by the Indenture as hereby amended,
but only upon the terms and conditions set forth in the Indenture,
including the terms and provisions defining and limiting the liabilities
and responsibilities of the Trustee, which terms and provisions shall in
like manner define and limit its liabilities and responsibilities in the
performance of the trust created by the Indenture as hereby amended, and,
without limiting the generality of the foregoing, the Trustee shall not be
responsible in any manner whatsoever for or with respect to any of the
recitals or statements contained herein, all of which recitals or
statements are made solely by the Company, KAAC, AJI, KJC, Kaiser Finance,
KMH, KSM, Texas Sierra, Texas Holdings, Kaiser Bellwood, and Kaiser
Transaction, or for or with respect to (i) the validity, efficacy or
sufficiency of this Second Supplemental Indenture or any of the terms or
provisions hereof, (ii) the proper authorization hereof by the Company,
KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas Holdings,
Kaiser Bellwood, and Kaiser Transaction by corporate action or limited
liability company action or otherwise, (iii) the due execution hereof by
the Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas
Holdings, Kaiser Bellwood, and Kaiser Transaction, or (iv) the consequences
(direct or indirect and whether deliberate or inadvertent) of any amendment
herein provided for, and the Trustee makes no representation with respect
to any such matters.



                                 SIGNATURES
                                      
          IN WITNESS WHEREOF, the parties hereto have caused this Second
Supplemental Indenture to be duly executed, all as of the date first
written above.


                                   KAISER ALUMINUM & CHEMICAL
                                   CORPORATION, as Issuer



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER ALUMINA AUSTRALIA
                                   CORPORATION, as a Subsidiary Guarantor



                                   By:    /s/     Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   ALPART JAMAICA INC., as a
                                   Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER JAMAICA CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER FINANCE CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER MICROMILL HOLDINGS, LLC,
                                   as a Subsidiary Guarantor


                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary



                                   KAISER SIERRA MICROMILLS, LLC,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER TEXAS SIERRA MICROMILLS,
                                   LLC, as a Subsidiary Guarantor

                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER TEXAS MICROMILL HOLDINGS,
                                   LLC, as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary



                                   KAISER BELLWOOD CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER TRANSACTION CORP.,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   U.S. BANK TRUST NATIONAL
                                   ASSOCIATION, as Trustee



                                   By:                                     
                                        -----------------------------------

                                   Name:                                   
                                        -----------------------------------

                                   Title:                                  
                                        -----------------------------------

Dated:  March 31, 1999

Attest:                                 
          ------------------------------

          Name:                         
               -------------------------

          Title:                        
               -------------------------






- ---------------------------------------------------------------------------


             KAISER ALUMINUM & CHEMICAL CORPORATION, as Issuer,
                                      
                   KAISER ALUMINA AUSTRALIA CORPORATION,
                            ALPART JAMAICA INC.,
                        KAISER JAMAICA CORPORATION,
                        KAISER FINANCE CORPORATION,
                      KAISER MICROMILL HOLDINGS, LLC,
                       KAISER SIERRA MICROMILLS, LLC,
                    KAISER TEXAS SIERRA MICROMILLS, LLC,
                   KAISER TEXAS MICROMILL HOLDINGS, LLC,
                      KAISER BELLWOOD CORPORATION, and
                        KAISER TRANSACTION CORP., as
                           Subsidiary Guarantors

                                    and

              U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
                                      
                                      
                       SECOND SUPPLEMENTAL INDENTURE

                         Dated as of March 31, 1999

                                     to

                                 INDENTURE

                       Dated as of December 23, 1996
                                      
                                      
                                      
                   10-7/8% Series D Senior Notes due 2006

- ---------------------------------------------------------------------------
          SECOND SUPPLEMENTAL INDENTURE, dated as of March 31, 1999, among
KAISER ALUMINUM & CHEMICAL CORPORATION, a Delaware corporation (the
"Company"), as Issuer, KAISER ALUMINA AUSTRALIA CORPORATION, a Delaware
corporation ("KAAC"), ALPART JAMAICA INC., a Delaware corporation ("AJI"),
KAISER JAMAICA CORPORATION, a Delaware corporation ("KJC"), KAISER FINANCE
CORPORATION, a Delaware corporation ("Kaiser Finance"), KAISER MICROMILL
HOLDINGS, LLC, a Delaware limited liability company ("KMH"), KAISER SIERRA
MICROMILLS, LLC, a Delaware limited liability company ("KSM"), KAISER TEXAS
SIERRA MICROMILLS, LLC, a Texas limited liability company ("Texas Sierra"),
KAISER TEXAS MICROMILL HOLDINGS, LLC, a Texas limited liability company
("Texas Holdings"), KAISER BELLWOOD CORPORATION, a Delaware corporation
("Kaiser Bellwood"), and KAISER TRANSACTION CORP., a Delaware corporation
("Kaiser Transaction"), as Subsidiary Guarantors, and U.S. Bank Trust
National Association (formerly known as First Trust National Association),
a national banking association, as Trustee (the "Trustee").

          WHEREAS, the Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM,
Texas Sierra, Texas Holdings, and the Trustee executed an Indenture, dated
as of December 23, 1996 (the "Original Indenture"), in respect of
$50,000,000 aggregate principal amount of the Company's 10-7/8% Series D
Senior Notes due 2006 (the "Securities"), and the Original Indenture was
amended by a First Supplemental Indenture, dated as of July 15, 1997 (the
Original Indenture, as amended by such First Supplemental Indenture
hereinafter referred to as the "Indenture"); and

          WHEREAS, Section 4.12 of the Indenture requires, under
circumstances specified in Section 4.12, that the Company shall cause
certain Subsidiaries of the Company to execute and deliver to the Trustee a
supplemental indenture in form and substance satisfactory to the Trustee
pursuant to which such Subsidiaries of the Company shall be named as
additional Subsidiary Guarantors; and

          WHEREAS, all conditions and requirements necessary to make this
Second Supplemental Indenture a valid, binding and legal instrument in
accordance with its terms have been performed and fulfilled and the
execution and delivery hereof have been in all respects duly authorized;

          NOW, THEREFORE, in consideration of the above premises, each
party agrees, for the benefit of the other and for the equal and ratable
benefit of the Holders of the Securities, as follows:

                                 ARTICLE I
                                      
                                 AMENDMENTS
                                      
          Section 1.  The Company, KAAC, AJI, KJC, Kaiser Finance, KMH,
KSM, Texas Sierra, Texas Holdings, Kaiser Bellwood, Kaiser Transaction, and
the Trustee hereby amend the Indenture and agree that Kaiser Transaction
shall be a Subsidiary Guarantor for all purposes under the Indenture and
the term "Subsidiary Guarantor" shall for all purposes under the Indenture
specifically include Kaiser Transaction.


                                 ARTICLE II

                          MISCELLANEOUS PROVISIONS

          Section 2.1.  Terms Defined.  For all purposes of this Second
Supplemental Indenture, except as otherwise defined or unless the context
otherwise requires, terms used in capitalized form in this Second
Supplemental Indenture and defined in the Indenture have the meanings
specified in the Indenture.

          Section 2.2.  Indenture.  Except as amended hereby, the Indenture
and the Securities are in all respects ratified and confirmed and all their
terms shall remain in full force and effect.

          Section 2.3.  Governing Law.  This Second Supplemental Indenture
shall be deemed to be a contract made under the laws of the State of New
York, and for all purposes shall be governed by and construed in accordance
with the laws of said state without regard to the principles of the
conflict of laws provisions thereof.

          Section 2.4.  Successors and Assigns.  All agreements of the
Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas
Holdings, Kaiser Bellwood, and Kaiser Transaction in this Second
Supplemental Indenture and the Securities shall bind its successors and
assigns.

          Section 2.5.  Multiple Counterparts.  This Second Supplemental
Indenture may be executed in any number of counterparts, each of which
shall be an original; but such counterparts shall together constitute but
one and the same instrument.

          Section 2.6.  Effectiveness.  The provisions of this Second
Supplemental Indenture shall become effective immediately upon its
execution and delivery by the Trustee in accordance with the provisions of
Article Ten of the Indenture.

          Section 2.7.  Trustee Disclaimer.  The Trustee accepts the
amendment of the Indenture effected by this Second Supplemental Indenture
and agrees to execute the trust created by the Indenture as hereby amended,
but only upon the terms and conditions set forth in the Indenture,
including the terms and provisions defining and limiting the liabilities
and responsibilities of the Trustee, which terms and provisions shall in
like manner define and limit its liabilities and responsibilities in the
performance of the trust created by the Indenture as hereby amended, and,
without limiting the generality of the foregoing, the Trustee shall not be
responsible in any manner whatsoever for or with respect to any of the
recitals or statements contained herein, all of which recitals or
statements are made solely by the Company, KAAC, AJI, KJC, Kaiser Finance,
KMH, KSM, Texas Sierra, Texas Holdings, Kaiser Bellwood, and Kaiser
Transaction, or for or with respect to (i) the validity, efficacy or
sufficiency of this Second Supplemental Indenture or any of the terms or
provisions hereof, (ii) the proper authorization hereof by the Company,
KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas Holdings,
Kaiser Bellwood, and Kaiser Transaction by corporate action or limited
liability company action or otherwise, (iii) the due execution hereof by
the Company, KAAC, AJI, KJC, Kaiser Finance, KMH, KSM, Texas Sierra, Texas
Holdings, Kaiser Bellwood, and Kaiser Transaction, or (iv) the consequences
(direct or indirect and whether deliberate or inadvertent) of any amendment
herein provided for, and the Trustee makes no representation with respect
to any such matters.



                                 SIGNATURES
                                      
          IN WITNESS WHEREOF, the parties hereto have caused this Second
Supplemental Indenture to be duly executed, all as of the date first
written above.


                                   KAISER ALUMINUM & CHEMICAL
                                   CORPORATION, as Issuer

                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER ALUMINA AUSTRALIA
                                   CORPORATION, as a Subsidiary Guarantor



                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   ALPART JAMAICA INC., as a
                                   Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary



                                   KAISER JAMAICA CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER FINANCE CORPORATION,
                                   as a Subsidiary Guarantor



                                   By:      /s/   Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Neimand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER MICROMILL HOLDINGS, LLC,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary



                                   KAISER SIERRA MICROMILLS, LLC,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER TEXAS SIERRA MICROMILLS,
                                   LLC, as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary

                                   KAISER TEXAS MICROMILL HOLDINGS,
                                   LLC, as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:    /s/      John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER BELLWOOD CORPORATION,
                                   as a Subsidiary Guarantor

                                   By:    /s/     Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:      /s/    John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   KAISER TRANSACTION CORP.,
                                   as a Subsidiary Guarantor



                                   By:     /s/    Karen A. Twitchell
                                        -----------------------------------
                                   Name:          Karen A. Twitchell
                                   Title:         Treasurer

Dated:  March 31, 1999

Attest:     /s/     John Wm. Niemand II
          -----------------------------
          Name:     John Wm. Niemand II
          Title:    Secretary


                                   U.S. BANK TRUST NATIONAL
                                   ASSOCIATION, as Trustee



                                   By:                                     
                                        -----------------------------------

                                   Name:                                   
                                        -----------------------------------

                                   Title:                                  
                                        -----------------------------------

Dated:  March 31, 1999

Attest:                                 
          ------------------------------

          Name:                         
               -------------------------

          Title:                        
               -------------------------




<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated financial statements of the Company for the three months
ended March 31, 1999, and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<CIK> 0000811596
<NAME> KAISER ALUMINUM CORPORATION
<MULTIPLIER> 1,000,000
       
<S>                             <C>
<PERIOD-TYPE>                   3-MOS
<FISCAL-YEAR-END>                          DEC-31-1999
<PERIOD-START>                             JAN-01-1999
<PERIOD-END>                               MAR-31-1999
<CASH>                                              11
<SECURITIES>                                         0
<RECEIVABLES>                                      282
<ALLOWANCES>                                         6
<INVENTORY>                                        529
<CURRENT-ASSETS>                                   931
<PP&E>                                           1,999
<DEPRECIATION>                                     900
<TOTAL-ASSETS>                                   2,934
<CURRENT-LIABILITIES>                              552
<BONDS>                                            963
                                0
                                          0
<COMMON>                                             1
<OTHER-SE>                                          80
<TOTAL-LIABILITY-AND-EQUITY>                     2,934
<SALES>                                            479
<TOTAL-REVENUES>                                   479
<CGS>                                              460
<TOTAL-COSTS>                                      460
<OTHER-EXPENSES>                                    24
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                  28
<INCOME-PRETAX>                                    (58)
<INCOME-TAX>                                       (20)
<INCOME-CONTINUING>                                (38)
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                       (38)
<EPS-PRIMARY>                                     (.48)
<EPS-DILUTED>                                     (.48)
        

</TABLE>


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