About 200 jobs will go as Australia’s last manganese smelter will close after failing to find a buyer.
The Liberty Bell Bay smelter in Tasmania fell into administration in March but it will now be shut down.
This comes despite administrator EY-Parthenon announcing in May it had entered an agreement with a consortium to purchase the business.
A major financial backer pulled out of the deal last month and the deal ultimately collapsed last week.
“In the absence of both a commercially viable transaction, and the funding required to continue operations, the Administrators have made the difficult decision to commence the orderly closure of the business with immediate effect,” EY-Parthenon said in a statement.
“These difficulties were, in part, driven by the broader economic challenges associated with operating the smelter in a volatile global economy.”
Employees were informed on Thursday morning and told more details will be shared next week.
The company will retain a small workforce to demobilise the site, facilitate selling its assets and meet regulatory obligations.
The Bell Bay Joint Unions said workers were “reeling” from the announcement.
“These workers have made an immeasurable contribution to the Tasmanian economy, and deserve full wrap-around support from state and federal government,” the Unions said in a statement.
“Today’s news comes as a blow after a protracted fight to save their smelter and the hundreds of local jobs it supports.”
The unions called on the state and federal governments to do “everything in their power to prevent the closure of this vital asset”.
“(This will) have devastating effects on the local economy and community,” they said.
“Emphasis must be on supporting the workforce, their families, and their community, who will be most negatively affected by the likely collapse of this vital industrial asset.
“The Unions are calling on the State and Federal governments to engage with the administrator to find a mechanism so that the sale process can be resumed.”
In a joint statement, Tasmanian Premier Jeremy Rockliff and Industry Minister Tim Ayres lamented the closure of the smelter.
“This is deeply difficult news for the workers of Liberty Bell Bay and the communities of Bell Bay, George Town and northern Tasmania who have fought tirelessly for a better outcome,” the statement said.
“Both the Commonwealth and Tasmanian governments are now focused on ensuring workers and their families are supported during this time, with immediate on-ground support now available.”
The smelter was constructed by BHP in 1962 and acquired by Liberty Steel Group, which is owned by British billionaire Sanjeev Gupta, in 2021.
Liberty Bell Bay in April said it would need to make about 175 workers redundant.
Both the federal and Tasmanian governments gave the smelter a $3 million lifeline.
That followed a $20 million loan from the Tasmanian government in August and after being in limited operations since May last year.