Exhibit 10.1


                            TIME-BASED STOCK OPTION GRANT
                                PURSUANT TO THE KAISER
                          1997 OMNIBUS STOCK INCENTIVE PLAN

               1.   GRANT OF STOCK OPTION.  Kaiser Aluminum Corporation
                    ---------------------
          ("KAC") and Kaiser Aluminium & Chemical Corporation ("KACC"),
          both Delaware corporations (collectively, the "Company"), hereby
          evidence that the Company has granted to JOSEPH A. BONN
          ("Optionee") the right, privilege and option as herein set forth
          (the "Stock Option") to purchase 163,190 shares of common stock,
          $.01 par value per share, of KAC (as more fully defined in
          Attachment I -- "Definitions Applicable to Certain Terms", which
          ------------
          is incorporated herein and made a part hereof, the "Option
          Shares") in accordance with the terms of this document (this
          "Stock Option Grant").

               The Stock Option is granted pursuant to the Kaiser 1997
          Omnibus Stock Incentive Plan (the "Plan") and is subject to the
          provisions of the Plan, a copy of which has been furnished to
          Optionee and which is hereby incorporated in and made a part of
          this Stock Option Grant, as well as to the provisions of this
          Stock Option Grant.  By acceptance of the Stock Option, Optionee
          agrees to be bound by all of the terms, provisions, conditions
          and limitations of the Plan and this Stock Option Grant.

               All capitalized terms used herein shall have the meanings
          provided in the Plan document unless otherwise specifically
          provided in this Stock Option Grant, including Attachment I.  The
                                                         ------------
          Stock Option is a Nonqualified Stock Option under the Plan and is
          not intended to qualify as an "incentive stock option" within the
          meaning of Section 422 of the Code.

               All Option Shares, when issued to Optionee upon the exercise
          of this Stock Option, shall be fully paid and nonassessable.

               2.   OPTION TERM.  Subject to earlier termination as
                    -----------
          provided herein, or in the Plan, the Stock Option shall expire on
          September 09, 2009.  The period during which the Stock Option is
          in effect shall be referred to as the "Option Period".

               3.   OPTION EXERCISE PRICE.  The exercise price per Option
                    ---------------------
          Share (including any Attributable Securities, as defined in
          Attachment I) (the "Option Price") at which Optionee may purchase
          ------------
          such Option Shares subject to the Stock Option shall be equal to
          the remainder of (i) $8.8438 per Option Share minus (ii) the
          amount per Option Share of Distributed Cash Value (as defined in
          Attachment I) determined as of the date of exercise.  Such Option
          ------------






          Price shall also be subject to adjustment as provided in the Plan
          and this Stock Option Grant.  The Company shall notify Optionee
          within thirty (30) days of each change in the Option Price.

               4.   VESTING.  The Stock Option may be exercised during the
                    -------
          Option Period only to the extent it has become a "Vested Option".
          Provided Optionee's Qualified Service Period (as defined in
          Attachment I) has not previously terminated, the Stock Option
          ------------
          shall become a "Vested Option" as to one-third of the Option
          Shares as of 12:01 a.m. Houston time on December 31, 1999, as to
          an additional one-third of the Option Shares as of 12:01 a.m.
          Houston time on December 31, 2000 and as to the final one-third
          of the Option Shares as of 12:01 a.m. Houston time on December
          31, 2001.  Notwithstanding the preceding sentence, if KAC
          experiences a Change in Control (as defined in Attachment I)
                                                         ------------
          prior to January 1, 2002 and prior to the end of Optionee's
          Qualified Service Period, then the Stock Option shall become a
          Vested Option, exercisable as to all Option Shares from and
          including the date of the Change in Control until and including
          the first anniversary of the Change
          in Control, upon which anniversary the Option Period shall
          terminate and this Stock Option shall expire.

               5.   METHOD OF EXERCISE.  To exercise the Stock Option,
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          Optionee shall deliver written notice to the Company stating the
          number of Option Shares with respect to which the Stock Option is
          being exercised together with payment for such Option Shares.
          Payment shall be made (i) in cash or its equivalent, (ii) by
          tendering previously acquired Shares having an aggregate Fair
          Market Value (as defined in the Plan) at the time of exercise
          equal to the total Option Price (provided that the Shares which
          are tendered must have been held by Optionee for at least six
          months prior to their tender to satisfy the Option Price) or
          (iii) by a combination of (i) and (ii).

               6.   TERMINATION OF OPTIONEE'S EMPLOYMENT.  Termination of
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          Optionee's employment as a regular full-time salaried employee of
          KAC, a Subsidiary (as defined in Attachment I), or any branch,
                                           ------------
          unit or division of KAC or any Subsidiary ("Employment") shall
          affect Optionee's rights under the Stock Option as follows:

                    (a)  Termination by the Company for Cause.  If
          Optionee's Employment is terminated by the Company at any
          time for Cause, then (i) the Option Period shall terminate
          and (ii) Optionee's right to exercise the Stock Option shall
          terminate, in each case immediately upon Optionee's becoming
          subject to termination of Employment for Cause. Optionee
          shall be terminated for "Cause" if terminated as a result of
          Optionee's breach of Optionee's written employment or other

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          engagement agreement (if any), or if the Board of Directors
          determines that Optionee is being terminated as a result of
          misconduct, dishonesty, disloyalty, disobedience or action
          that might reasonably be expected to injure KAC or any
          Subsidiary or their business interests or reputation.

                    (b)  Termination by the Company Other than for Cause.
          If Optionee's Employment is terminated by the Company prior
          to January 1, 2002 other than as a result of termination of
          Optionee's Employment for Cause, then (i) the Stock Option
          and the Option Period shall not terminate and (ii) the Stock
          Option shall thereafter be exercisable as to all Option
          Shares from and including the date of such termination
          through and including the end of the Option Period.

                    (c)  Other Termination.  If Optionee's Qualified
          Service Period terminates prior to January 1, 2002 other
          than as a result of termination of Optionee's Employment by
          the Company, then (i) the Stock Option and the Option Period
          shall not terminate but the Stock Option shall thereafter be
          exercisable only to the extent it has become a Vested Option
          as of the date of termination of Optionee's Qualified
          Service Period and otherwise is exercisable in accordance
          with the provisions of this Stock Option Grant and the Plan.

          The Stock Option may be exercised by Optionee or, in the case of
          death, by the executor or administrator of Optionee's estate, or
          the person or persons to whom Optionee's rights under the Stock
          Option shall pass by will or by the applicable laws of descent
          and distribution, or in the case of Disability, by Optionee's
          personal representative.

               7.   REORGANIZATIONS; REPURCHASE OF STOCK OPTION.
                    -------------------------------------------
                    (a)  Freedom to Reorganize the Company and
          Subsidiaries.  The existence of the Stock Option shall not
          affect in any way the right or power of the Company and its
          Subsidiaries or the issuers of Attributable Securities or
          its or their stockholders to make or authorize any and all
          Distribution Events (as defined in Attachment I) and any and
                                                  ------------
          all other adjustments, recapitalizations, reorganizations
          or other changes in the capital structure or business of the
          Company or its Subsidiaries or the issuers of Attributable
          Securities, any and all issuances of bonds, debentures,
          common stock, preferred or prior preference stock, warrants,
          rights or other securities, whether or not affecting the
          Option Shares or the rights thereof, any dissolution or
          liquidation of the Company or any Subsidiary, any sale or
          other divestiture or transfer of all or any part of the
          assets or business of the Company or any Subsidiary or any
          issuer of Attributable Securities and any and all other
          corporate acts or proceedings, whether of a similar
          character or otherwise (collectively, including any
          Distribution Events, collectively, "Reorganizations").

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                    (b)  Spin-Offs.  If the Board of Directors authorizes
          any Distribution Event or other Reorganization as a result
          of which holders of Shares (as defined in Attachment I)
                                                    ------------
          become entitled, in their capacities as holders, to receive
          Marketable Securities, the Board of Directors shall, to the
          extent reasonably practicable, cause the Company to provide
          for or require: (i) that the issuer(s) of such Marketable
          Securities shall undertake to issue and deliver to Optionee,
          upon any subsequent exercise of the Stock Option, such
          Marketable Securities as Optionee would have received if
          Optionee had so exercised the Stock Option prior to such
          Distribution Event or other Reorganization and had
          participated therein (and in any and all subsequent
          Distribution Events or other Reorganizations) to the maximum
          extent allowed to holders of Shares (including any
          Attributable Securities) outstanding at the time of such
          Distribution Event or other Reorganization; (ii) that such
          Marketable Securities shall be so issued and delivered to
          Optionee pursuant to an effective registration statement
          under the Securities Act of 1933, as amended, or otherwise
          free of any restriction on resale thereof by Optionee, other
          than any restriction on resale arising from Optionee's being
          an Affiliate or Insider (as such terms are defined in the
          Plan) of such issuer; (iii) that such Marketable Securities
          shall be so issued and delivered without any agreement,
          condition, payment or other consideration being required of
          Optionee or the Company; (iv) that such issuer(s) shall at
          all times reserve for issuance a sufficient amount of such
          Marketable Securities to fulfill all obligations
          contemplated hereunder; and (v) that upon each such
          issuance, such Marketable Securities shall be duly
          authorized, validly issued, fully paid and nonassessable.
          The Company shall also provide for or require that: (x) in
          the event any such issuer shall fail or be unable to issue
          and deliver to Optionee any Marketable Securities as
          provided in the preceding sentence, such issuer shall be
          obligated, in lieu of issuing and delivering such Marketable
          Securities, to pay to Optionee in cash, immediately upon
          exercise of the Stock Option, the Market Value of such
          Marketable Securities determined as of the date of exercise
          of the Stock Option; and (y) in the event the Company is
          obligated to make a cash payment to Optionee pursuant to
          Paragraph 8(b), such issuer shall be obligated to reimburse
          the Company for a part of such payment proportionate to the
          Distributed Cash Value attributable to Attributable
          Securities of such issuer compared to the total amount of
          Distributed Cash Value.

                    (c)  Right to Repurchase Stock Option.  Upon receipt of
          a notice of exercise, the Company shall have the right but
          not the obligation to repurchase, and thereby to satisfy all
          of the Company's obligations under, the Stock Option as to
          the number of Option Shares as to which the Stock Option is
          exercised by paying Optionee in cash an amount, net of any

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          taxes required to be withheld, equal to the sum of (A) the
          product of (i) the number of Option Shares as to which the
          Stock Option is exercised multiplied by (ii) the amount,
          determined as of such date of exercise, equal to the
          remainder of (x) the Market Value of one Option Share minus
          (y) the Option Price plus (B) the amount of cash, if any,
          payable to Optionee pursuant to Paragraph 8(b).

               8.   ADJUSTMENTS.
                    -----------

                    (a)  In the event of any one or more Distribution
          Events or other Reorganizations affecting the Stock Option
          and not already adjusted for under Paragraph 7, the Option
          Price and the number of Option Shares subject to the Stock
          Option shall be appropriately adjusted by the Board of
          Directors.  In addition, the Board of Directors shall, as
          permitted by Section 3.2, Section 16.2 and other provisions
          of the Plan, construe and interpret the Plan and this Stock
          Option Grant and make all appropriate adjustments in order
          to prevent dilution or enlargement of the benefits or
          potential benefits intended to be made available to Optionee
          under this Stock Option Grant and the Plan.

                    (b)  Without limitation to the foregoing, in the event
          that the amount of Distributed Cash Value as of any date of
          exercise of the Stock Option is equal to or greater than
          $8.8438 per Option Share, the Option Price shall be deemed
          to be $.01 per Option Share and the Company, in addition to
          issuing Option Shares to Optionee, shall pay to Optionee in
          respect of each Option Share as to which the Stock Option is
          exercised an amount of cash equal to the remainder of (i)
          such amount of Distributed Cash Value per Option Share minus
          (ii) $8.8438.

               9.   NO RIGHTS IN OPTION SHARES.  Optionee shall have no
                    --------------------------
          rights as a stockholder in respect of Option Shares until such
          Optionee becomes the holder of record of such Option Shares.

               10.  OPTION SHARES RESERVED.  The Company shall at all times
                    ----------------------
          during the Option Period reserve and keep available such number
          of Shares as will be sufficient to satisfy the requirements of
          this Stock Option.











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               11.  NONTRANSFERABILITV OF STOCK OPTION.  The Stock Option
                    ----------------------------------
          granted pursuant to this Stock Option Grant is not transferable
          other than by will, the laws of descent and distribution or by
          qualified domestic relations order.  The Stock Option will be
          exercisable during Optionee's lifetime only by Optionee or by
          Optionee's guardian or legal representative.  No right or benefit
          hereunder shall in any manner be liable for or subject to any
          debts, contracts, liabilities, or torts of Optionee.

               12.  AMENDMENT AND TERMINATION.  No amendment or termination
                    -------------------------
          of the Stock Option shall be made by the Board of Directors or
          the Committee (as defined in the Plan) at any time without the
          written consent of Optionee.  No amendment of the Plan will
          adversely affect the rights, privileges and options of Optionee
          under the Stock Option without the written consent of Optionee.

               13.  NO GUARANTEE OF EMPLOYMENT.  The Stock Option shall not
                    --------------------------
          confer upon Optionee any right with respect to continuance of
          Employment or other service with the Company or any Subsidiary or
          Affiliate, nor shall it interfere in any way with any right the
          Company or any Subsidiary or Affiliate would otherwise have to
          terminate such Optionee's Employment or other service at any
          time.

               14.  WITHHOLDING OF TAXES.  The Company shall have the right
                    --------------------
          to deduct or withhold, or require Optionee to remit to the
          Company, an amount sufficient to satisfy all federal, state and
          local taxes, domestic or foreign, required by law or regulation
          to be withheld with respect to any taxable event arising under
          this Stock Option Grant or any exercise or other action or event
          hereunder.

               15.  NO GUARANTEE OF TAX CONSEQUENCES.  Neither the Company
                    --------------------------------
          nor any Subsidiary or Affiliate, nor the Board of Directors or
          any Committee, makes any commitment or guarantee that any federal
          or state tax treatment will apply or be available to any person
          eligible for benefits under the Stock Option.

               16.  SEVERABILITY.  In the event that any provision of the
                    ------------
          Stock Option shall be held illegal, invalid, or unenforceable for
          any reason, such provision shall be fully severable, but shall
          not affect the remaining provisions of the Stock Option, and the
          Stock Option shall be construed and enforced as if the illegal,
          invalid, or unenforceable provision had never been included
          herein.

               17.  GOVERNING LAW.  The Stock Option shall be construed in
                    -------------
          accordance with the laws of the State of Texas to the extent

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          federal law does not supersede and preempt Texas law.

          Executed effective as of the 9th day of September, 1999.

                                     "COMPANY"

                                     KAISER ALUMINUM CORPORATION

                                     By:   /s/ Raymond J. Milchovich
                                     Printed Name:  Raymond J. Milchovich
                                     Title:  President and COO

                                     KAISER ALUMINUM & CHEMICAL CORPORATION

                                     By:   /s/ Raymond J. Milchovich
                                     Printed Name:  Raymond J. Milchovich
                                     Title:  President and COO


          Accepted effective as of the 9th day of September, 1999.

                                             "OPTIONEE"

                                             /s/  Joseph A. Bonn
                                             Printed Name:  Joseph A. Bonn
                                             Title:  Vice President






























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                                                               ATTACHMENT I

                            TIME-BASED STOCK OPTION GRANT

                       DEFINITIONS APPLICABLE TO CERTAIN TERMS

          "AFFILIATE" -- see Section 2.1 of the Plan.

          "ATTRIBUTABLE SECURITIES" -- see the definition of "Option
          Share".

          "CAUSE" -- see Paragraph 6(a) of this Stock Option Grant.

          "CHANGE IN CONTROL" means a change in control of KAC that would
          be required to be reported in response to item 6(e) of Schedule
          14A of Regulation 14A under the Securities Exchange Act of 1934,
          as amended, assuming such Schedule, Regulation and Act were
          applicable to KAC as in effect on April 15, 1998.

          "DISABILITY" -- See Section 2.12 of the Plan.

          "DISTRIBUTED CASH VALUE" means, as of any determination date, the
          aggregate amount of cash (other than regular quarterly cash
          dividends, if any) plus the aggregate value, as determined by the
          Board of Directors as of the date of distribution, of all
          property (other than cash and Attributable Securities)
          distributed or set aside for distribution to the holder of one
          Original Share and all Attributable Securities, if any, during
          the period commencing January 1, 1999 and ending on the
          determination date.

          "DISTRIBUTION EVENTS" means any and all distributions, dividends,
          recapitalizations, forward or reverse splits, reorganizations,
          mergers, consolidations, spin-offs, combinations, repurchases,
          share exchanges, or other similar or substantially equivalent
          corporate transactions or events in which the holder of a
          security becomes, as such, entitled to receive cash, securities
          or other property in addition to or in exchange for or upon
          conversion of such security.

          "EMPLOYMENT" -- see Paragraph 6 of this Stock Option Grant.

          "INSIDER" -- see Section 2.19 of the Plan.

          "KAC" -- see Paragraph 1 of this Stock Option Grant.

          "KACC" -- see Paragraph 1 of this Stock Option Grant.

          "MARKET VALUE" means, as of any Trading Day, the average of the
          highest and lowest sales prices as reported by the consolidated
          tape (or, if such prices are not quoted, the average of the
          quoted closing bid and asked prices) on such Trading Day for one
          Option Share (including, as applicable, the Market Values of any
          Attributable Securities).  In the event that sales prices or
          closing bid and asked prices are not quoted on a particular

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          Trading Day, the Market Value for that Trading Day shall be
          deemed to be the Market Value for the immediately preceding
          Trading Day.  In the event that any Attributable Security shall
          cease to be a Marketable Security, it shall thereupon be deemed
          to have no further Market Value and shall be deemed instead to
          have, as of the date it ceases to be a Marketable Security, such
          Distributed Cash Value as shall be determined by the Board of
          Directors.

          "MARKETABLE SECURITIES" means securities (a) of a class that is
          registered under the Securities Exchange Act of 1934, as amended,
          (b) for which sales prices or bid and asked prices are regularly
          quoted and (c) that, if issued and delivered to Optionee upon
          exercise of the Stock Option, would not be subject to any
          restriction on resale, other than any restriction arising from
          Optionee's being an Affiliate or Insider (as such terms are
          defined in the Plan) of the issuer of such Marketable Securities.

          "OPTION PERIOD" -- see Paragraph 2 of this Stock Option Grant.

          "OPTION PRICE" -- see Paragraph 3 of this Stock Option Grant.

          "OPTION SHARE" means (a) one Share as constituted on January 1,
          1999 (an "Original Share") and (b) in the event of any one or
          more successive Distribution Events, all Marketable Securities
          ("Attributable Securities") into which or for which an Original
          Share or any Attributable Securities may be converted or
          exchanged or that a Stockholder may have the right to receive in
          respect of such Original Share or Attributable Securities.

          "OPTIONEE" -- see Paragraph 1 of this Stock Option Grant.

          "ORIGINAL SHARE" -- see the definition of "Option Share"

          "PLAN" -- see Paragraph 1 of this Stock Option Grant.

          "QUALIFIED SERVICE PERIOD" means the period from and including
          January 1, 1999 through and including the earlier of (a) December
          31, 2001 or (b) the date immediately preceding the date of
          termination of Optionee's Employment; provided, however, that if
          Optionee's Employment has not terminated prior to the date that a
          proposed transaction is announced by KAC that would cause KAC to
          experience a Change in Control  and such transaction is
          subsequently consummated so that KAC experiences a Change in
          Control, then Optionee's Qualified Service Period shall be deemed
          to continue through the date of consummation of such transaction
          and Change in Control unless Optionee's Employment is terminated
          by the Company for Cause or by Optionee.

          "REORGANIZATION" -- see Section 7(a) of this Stock Option Grant.

          "SHARE" means one share of common stock, par value $.01 per
          share, of KAC.

          "STOCK OPTION" -- see Paragraph 1 of this Stock Option Grant.

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          "SUBSIDIARY" -- see Section 2.32 of the Plan.  For avoidance of
          doubt, KACC shall be considered a Subsidiary of KAC so long as
          KAC has a majority voting interest in KACC, and KAC shall be
          considered to have a majority voting interest whether it holds
          such interest directly or indirectly through one or more
          Subsidiaries.

          "TRADING DAY" means as to an Option Share (including any
          Attributable Securities) a day when the New York Stock Exchange
          (or other principal securities exchange, including Nasdaq, on
          which such securities are traded) is open.













































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