Kaiser Aluminium and Rio Tinto Alcan have put a counter proposal forward that would see Anglesey Aluminium operating with only one potline, effectively half its capacity, until the end of 2010.
The new approach would enable the company to see if its current plan for an on-site biomass power plant would be successful as a replacement electricity source.
Local MP Albert Owen was very pleased to see that the company is still willing to commit to the idea of continuing operations on the island, where it still employs over 450 people.
Welsh Secretary Peter Hain, who has been playing a key role in trying to find a solution to the problem, welcomed the decision of Rio Tinto Alcan and Kaiser Aluminium to think creatively about how they can take up the generous offer of £48 million from the UK Government.
Negotiations are expected to continue for another week.