A method of processing spent aluminum pot liner containing carbon, cyanide compositions, fluorides and inorganic oxides. The spent aluminum pot liner is crushed iron oxide is added to form an agglomerated material. The agglomerated material is melted in an electric arc furnace having the electrodes submerged in the molten material to provide a reducing environment during the furnace operation. In the reducing environment, pot liner is oxidized while the iron oxides are reduced to produce iron and a slag substantially free of cyanide compositions and fluorides. An off-gas including carbon oxides and fluorine is treated in an air pollution control system with an afterburner and a scrubber to produce NaF, water and a gas vented to the atmosphere free of cyanide compositions, fluorine and CO.