BlueScope Steel has confirmed its status as a frontrunner to take over the Whyalla steelworks, forming a consortium with three other international steelmaking corporations interested in purchasing the industrial facility.<\/p>\n
After expressions of interest for the steelworks closed last week, BlueScope revealed to the stock exchange on Monday that it was leading a consortium that included Japan’s Nippon Steel, India’s JSW Steel, and South Korea’s POSCO.<\/p>\n
The group, which according to BlueScope has a combined market capitalisation of $115 billion, has submitted a non-binding expression of interest for the Whyalla steelworks.<\/p>\n
“The consortium has identified Whyalla as a prospective location for future production of lower emissions iron in Australia for both domestic and export markets, with the potential to play an important role in the decarbonisation of the global steelmaking industry,” BlueScope said in a statement.<\/p>\n
“Should the consortium be invited to participate in the next phase of the sale process, the consortium will jointly conduct due diligence and engage with the South Australian and Federal governments regarding the announced funding support to maintain a sustainable steel industry in the region.”<\/p>\n
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BlueScope CEO Mark Vassella has previously said the company is interested in the steelworks, but it would have to make sense for shareholders. (ABC Illawarra: Tim Fernandez)<\/p>\n
BlueScope added that any offer to acquire the steelworks would be subject to “hurdles”, including due diligence and other considerations around return on investment for consortium members.<\/p>\n
Nippon, POSCO and JSW are among the biggest steel companies in the world, ranking 4th, 8th and 12th respectively for total steel production in 2024, according to the World Steel Association.<\/a><\/p>\n Energy and Mining Minister Tom Koutsantonis said the consortium’s interest in the steelworks was “great news”.<\/p>\n “If you had told the premier and I in February that the consortium would be made up of companies like POSCO, Nippon, BlueScope \u2014 we would have been overwhelmed,” he said.<\/p>\n “Seeing consortiums like this put their hands up \u2014 the prestige behind it, the expertise, the deep pockets, the long-term thinking \u2014 is really encouraging.”<\/p>\n More than 15 national and international parties have passed the final expression of interest stage for the steelworks, according to the government.<\/p>\n ‘Not time to pop the champagne corks’ The Whyalla steelworks directly employs more than a thousand people. (ABC News: Lincoln Rothall)<\/p>\n The state government placed the Whyalla steelworks into administration in February<\/a>, stripping ownership of the plant from British industrialist Sanjeev Gupta’s GFG Alliance.<\/p>\n The plant has since been in the hands of administrators KordaMentha, which have been receiving expert advice from BlueScope on the steelworks’ operations.<\/p>\n The state and federal governments have allocated $659 million to keeping the steelworks afloat through administration<\/a>.<\/p>\n A further $1.9 billion is on the table to help the next steelworks owner decarbonise the facility and transition to green iron and green steelmaking.<\/p>\n Mr Koutsantonis reiterated the state government’s expectation that a sale would not be finalised until the second half of 2026.<\/p>\n “It’s not time to pop the champagne corks just yet,” he said.<\/p>\n “But we are on the right track, and we are meeting the milestones we hoped to meet.”<\/p>\n Hopes rise for Port Pirie rescue package<\/p>\n While the state government’s confidence about Whyalla is growing, there is still doubt in the Spencer Gulf about another major employer.<\/p>\n The Port Pirie lead smelter, which employs about 900 people, is losing tens of millions of dollars a month<\/a>, according to owner Nyrstar Australia.<\/p>\n SA Premier grapples with mounting demands for taxpayer bailouts<\/a><\/p>\n The South Australian government is facing more demands for taxpayer-funded bailouts after its Whyalla intervention. Can the state budget sustain it?<\/p>\n The company has been publicly and privately lobbying for government help<\/a> to protect its smelting operations in Port Pirie and Hobart, which it said have become uneconomical due to “market distortion” form China.<\/a><\/p>\n State cabinet is travelling to Port Pirie for a community meeting on Monday night, fuelling hopes for a support package announcement.<\/p>\n “What I would expect to see there, is we would have some answers in regards to Nyrstar,” Port Pirie Mayor Leon Stephens said, adding that he had not been briefed on any funding announcement.<\/p>\n Cr Stephens, who is also running as a Liberal Party candidate at next year’s state election, said the Port Pirie community needs surety about its future.<\/p>\n “The government’s very tight-lipped on it,” he said.<\/p>\n “You really want these things to go ahead as quick as possible so that the community doesn’t get more deflated.”<\/p>\n Premier Peter Malinauskas said on Monday a funding deal was “hopefully very close”, but technical details were still being worked through.<\/p>\n The multi-metal smelter has been operating in Port Pirie for more than a century.\u00a0 (ABC News)<\/p>\n He said the state government “is willing to invest” provided the money sets the smelter up for the future and protects local jobs.<\/p>\n “We’ve been very clear with [Nyrstar’s parent company] Trafigura that the only circumstances under which the South Australian government is going to invest any support in Nyrstar is if it’s about setting it up for an even better and commercial future,” he said.<\/p>\n “We accept, and it’s undeniable, that Nyrstar is facing challenges not of its own making.”<\/p>\n Fears for Port Pirie exodus if smelter closes<\/p>\n If Port Pirie’s lead smelter were to close, the city could lose 2,000 people, according to a report released on Monday by progressive think tank The McKell Institute.<\/p>\n That accounts for more than 11 per cent of the city’s nearly 14,000 residents, the institute said.<\/p>\n<\/p>\n
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