Greensill crisis may affect Whyalla DRI/EAF conversion: reports

Australian steel producer Whyalla steelworks’ equipment revamp has been called into question by issues with financing at parent company GFG Alliance, Kallanish notes from local media.

Credit Suisse has suspended activity at a number of supply chain funds linked to Greensill Capital, a major lender to Liberty Steel (see Kallanish passim). The Whyalla operations are part of the global Liberty Steel network. Greensill Capital is an investment arm owned by Australian Lex Greensill. Australian Workers Union state secretary Peter Lamps is quoted as saying the union is concerned about the potential fallout from the Greensill issues on GFG Alliance and its operations.

”Our integrated operations at Whyalla, which include the mining assets and the steelworks, are in the black,” GFG said in a statement on Wednesday. The recovery of the construction steel market and the surge in iron ore prices caused the producer to make a profit last year.

Whyalla plans to replace its 1.2 million tonnes/year capacity blast furnace with a direct reduced iron plant and electric arc furnace. Iron ore and scrap feedstock will come from GFG subsidiary Simec Mining and local scrap suppliers. This upgrade is expected to be completed in 2024, with GFG targeting construction of facilities over three years starting from 2021. The capacity of the Whyalla steelworks will be doubled at that time.

By Kallanish Team