August 20, 1993

     Mr. Robert E. Cole
     Vice President, Government Affairs
     900 17th Street, N.W.
     Washington, D.C.  20006

     Dear Bob:

          In order to help assure your retention and to provide a measure
     of compensation that is competitive with the marketplace, Management
     has agreed that it is in the best interest of Kaiser Aluminum &
     Chemical Corp. ("the Company") to enter into the following agreement
     with you.  It is our purpose hereby to reinforce and encourage your
     continued attention and dedication to your assigned duties.  To that
     end we have agreed as follows:

     1.   The Company will, immediately following execution of this
     agreement, pay you a special payment of $33,000.00 and, provided you
     remain in the employ of the Company until each of said dates, make
     separate special payments to you of like amounts on or about August 1,
     1994, August 1, 1995, and August 1, 1996.

     2.   If you remain in the employ of the Company through a date three
     years from the date of this letter (the "Qualification Date") and you
     hereby confirm that it is your present intention to do so, in addition
     to your base salary and the above special payments during this period,
     the Company will pay to you the aggregate of the amounts set aside as
     retention payments in 1993, 1994 and 1995, to wit, on August 1 of each
     respective year, $33,000; $25,000; and $25,000, or a total of $83,000,
     provided you are a full-time employee of the Company on the
     Qualification Date.  This retention payment will be made 30 days after
     the Qualification Date, and both it and the special payments will be
     subject to standard payroll tax deductions and withholding, and will
     be in addition to and have no effect upon any other bonus or benefit
     plans for which you may be eligible.  Such payments are not and will
     not be made a part of your base salary.

          Nothing contained herein is intended to impair the Company's
     right to terminate your employment, either before or after the
     Qualification Date, for any of the reasons set forth in the
     termination policy of the Company including, without limitation, your
     inability to perform your duties, nor to impair your right to resign
     at any time.  Should you resign, be discharged for serious cause, be
     discharged for failure to accept another suitable

     
     position with the Company, or retire voluntarily prior to the
     Qualification Date, no part of the retention payment shall be payable
     to you.  However, should you be terminated prior to the Qualification
     Date under any other circumstances, including by reason of death or
     permanent disability prior to the Qualification Date, you or your
     estate will receive any retention payment credited up to the date of
     termination and in addition such payment shall include a proration of
     the retention payment for any partial year elapsed between the last
     previous retention credit and the date of termination.

          Your signature below signifies that you are in agreement with the
     terms of this letter.

                                             Sincerely,



                                             A. Stephens Hutchcraft
                                             Chairman of the Board &








                                             Chief Executive Officer

     /kl

          Agreed to this 30th day

          of August, 1993.




          Robert E. Cole