The Al3H9 and Al3H7 potential energy surfaces were explored using quantum chemistry calculations to investigate the H-2 loss mechanism from Al3H9, which provide new insights into hydrogen production from bulk alane, [AlH3](x), a possible energy storage material. We present results of B3LYP/6-311++G(d,p) calculations for the various Al3H9 and Al3H7 optimized local minima and transition state structures along with some reaction pathways for their interconversion. We find the energy for Al3H9 decomposition into Al2H6 and AlH3 is slightly lower than that for H-2 loss and Al3H7 formation, but the calculations show that H-2 loss from Al3H9 is a lower energy process than for losing hydrogen from either Al2H6 or AlH3. We found four transition state structures and reaction pathways for Al3H9 Al3H7 + H-2) where the lowest energy activation barrier is around 25-73 kJ/mol greater than the experimental value for H-2 loss from bulk alane. Intrinsic reaction coordinate calculations show that the H-2 loss pathway involves considerable rearrangement of the H atom positions around a single Al center. Three of the pathways start with the formation of an AlH3 moiety, which then enables a terminal H on the AlH3 to get within 1.1 to 1.2 A of a nearby bridging H atom. The bridging and terminal H atoms eventually combine to form H-2 and leave Al3H9. One implication of these H-2 loss reaction pathways is that, since the H atoms in bulk alanes are all at bridging positions, if a similar H-2 loss mechanism were to apply to bulk alane, then H-2 loss would most likely occur on the bulk alane surface or at a defect site where there should be more terminal H atoms available for reaction with nearby bridging H atoms.