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Tata Steel has said at a recent hearing of Parliament’s Welsh affairs committee that if there is funding available for greener ways of making steel, the company would discuss it, said reports.
Tata Steel’s global chief executive TV Narendran on January 31 also defended his decision to cut jobs at Port Talbot, denying an accusation that £ 500 million in government support represented “the deal of the century” for the company.
He told MPs that shareholders in the Indian-listed firm had grown weary of billions of pounds being spent on the Port Talbot plant.
Tata Steel said it is currently losing around £ 1 million a day from its operations in Port Talbot, and keeping a blast furnace open on the site and making steel from scratch would lead to a further loss of £ 600 million. Tata Steel would consider additional investments in the plant if more government funding was made available, said Narendran.
The UK Government earlier agreed to the £ 500 million package to support the loss-making plant employing around 8,000 people, which was facing shutdown over high carbon emission. Tata Steel will replace the blast furnaces with electric furnaces to use recycled steel in order to reduce carbon emission. This is a part of the restructuring plan.
The company had announced that the blast furnaces would close later this year and it would be replaced with a new electric arc furnace – part-funded by the government subsidy. However, the installation of a lowemission system will lead to a cut in 2,800 jobs as electric furnaces need less manpower.
The company informed that the decision would affect 2,500 jobs at Port Talbot and a further 300 at another south Wales site, in Llanwern. Steel unions had suggested the government put in more money for securing the future of Tata Steel.
The Tata decision, along with a similar plan by British Steel to close blast furnaces at Scunthorpe, will represent a new era for the UK as it will leave the country unable to produce steel from iron ore for the first time since the Industrial Revolution, added a report in The Guardian newspaper. Tata’s plan for Port Talbot instead relies on using scrap steel from the UK, which is mostly exported, it said.
