Tata Steel says it will continue with its Port Talbot blast furnace operations closure despite being “apprehensive” about reports the upcoming UK general election may put the investment under threat.
“We urge and request the current and the incoming government post-elections, to adhere to and safeguard the agreed terms of the £500 million package of support for the Electric Arc Furnace (EAF) project announced in September 2023,” Tata Steel writes in a note seen by Kallanish.
“The proposed grant funding from the UK Government is ring fenced for building the new EAF, which is critical to securing long-term supply of steel for Tata Steel’s UK downstream assets and protecting 5,000 jobs in various Tata Steel UK sites. It is not linked to the ongoing financial losses and the instability of the existing heavy end assets, whose closure is now underway and immutable. We are therefore concerned with the UK media reports since yesterday as further political uncertainty on the timing and form of the grant will place the EAF project and the long-term future of steelmaking at Port Talbot at significant risk,” it added on Tuesday.
Tata said in April it is proceeding with its single 3 million tonnes/year electric arc furnace plan for Port Talbot following seven months of formal and informal national level discussions with UK trade unions (see Kallanish passim). Unions responded by saying they plan to call a strike.
Port Talbot’s two blast furnaces, no.5 and no.4, are scheduled to be closed by end-June and end-September respectively. The UK general election is scheduled for 4 July, with the opposition Labour Party ahead in the polls.
Tata Steel UK’s deliveries in the March quarter fell 9% on-year but rose 8% on-quarter to 690,000t, while liquid steel output fell 11% on-year and dropped 8% on-quarter to 660,000t.
Adam Smith Poland
