Tata Steel has signed a £500-million grant funding agreement with the UK government to help speed up the £1.25-billion green steel project at the Port Talbot steelworks factory.
The project involves replacing the blast furnaces with electric arc furnace and is expected to help reduce the UK’s industrial carbon emissions by 8% and Port Talbot’s by 90%.
“With the UK government’s critical support, this complex and ambitious transformation of Port Talbot has the potential to make the plant one of Europe’s premier centres for green steelmaking,” TV Narendran, CEO and managing director of Tata Steel, said in a statement on Wednesday.
Narendran added that the company will continue to work with the transition board and the UK and Welsh governments to enable economic regeneration and job creation in South Wales through the project.
The announcement of the transition to a green steel facility at Port Talbot was met with fears of job losses as the new electric arc furnace is less labour-intensive. An estimated 2,500 jobs are expected to be made redundant because of the transition.
Tata Steel addressed the job redundancy concerns in its statement, saying that it has finalised a memorandum of understanding with the UK Steel Committee following extensive discussions with the employee representative.
“Tata Steel is offering its most generous-ever support package to employees leaving the company, and a comprehensive voluntary redundancy aspiration process combined with cross-matching and/or re-skilling,” the company said.
Employees of Port Talbot who are at risk of compulsory redundancy will be provided the option to participate in a paid retraining scheme for a defined period to help them secure alternative future employment by the company.
The electric arc furnace is expected to be operational within three years. So far, the basic engineering has been completed and equipment order for the electric arc furnace will be placed shortly, along with ladle metallurgy furnaces, a new coil box and crop shear for the hot strip mill, a cranes package, and for construction management and civil engineering, the company said.
Meanwhile, the Port Talbot steelworks site has closed down one blast furnace and the Morfa coke ovens safely over the past few months, and efforts are in progress to close down the other blast furnace.
On Wednesday, UK’s business and trade secretary Jonathan Reynolds told the House of Commons that the Labour government had succeeded in going much further than the previous Tory government’s pact, delivering a minimum voluntary redundancy payout of £15,000 for full-time employees plus a £5,000 “retention” payment. “Port Talbot has always been and will always be a steelmaking town. This deal does what previous deals failed to do – give hope for the future of steelmaking in South Wales,” Reynolds said.
From: financialexpress
Financial News
