Tata Steel announces major revamp of Port Talbot works PES Media

Tata Steel has announced it will commence statutory consultation as part of its plan to transform and restructure its UK business.

This plan it says is intended to reverse more than a decade of losses and transition from the legacy blast furnaces to a more sustainable, green steel business. The transformation would secure most of Tata Steel UK’s existing product capability and maintain the country’s self-sufficiency in steelmaking, while also reducing Tata Steel UK’s CO2 emissions by 5 million tonnes per year.

The plans follow detailed discussions with the UK multi-trade union representative body (UK Steel Committee) and its advisors, in which Tata Steel carefully considered their endorsed proposal for maintaining a single blast furnace.

Having considered that proposal, Tata Steel has agreed to adopt elements of it, but considers that continued blast furnace production is not feasible or affordable.

The steel maker will now commence statutory consultation on the proposed restructuring plan and support arrangements for affected employees. Up to 2,800 employees are expected to be potentially affected, out of which around 2,500 roles would be impacted in the next 18 months.

The company says it will endeavour to maximise voluntary redundancies and proposes to commit in excess of £130 million to a comprehensive support package for affected workers.

This is in addition to the £100 million funding for the Transition Board set up with UK and Welsh governments to support affected employees, contractors and communities.

Port Talbot’s two high-emission blast furnaces and coke ovens would close in a phased manner with the first blast furnace closing around mid-2024 and the remaining heavy end assets would wind down during the second half of 2024. The proposal also includes a wider restructuring of other locations and functions across the company.

In discussion with the UK Steel Committee, Tata Steel has agreed that it would continue to operate the hot strip mill through the proposed transition period and in future. In addition, the downstream and steel processing centres would continue to serve customers by utilising imported semi-finished steel from Tata Steel plants in the Netherlands and India as well as other select strategic suppliers.

Under the transformation plan, Tata Steel will embark on a £1.25 billion investment in Electric Arc Furnace technology in Port Talbot to secure long-term, high-quality production at the UK’s largest steelmaker.

The proposed investment is supported by the UK Government, which has committed up to £500 million to enable the transformation. Tata Steel plans to invest £750 million in the project.

The GMB and Community unions have rejected the plans commenting: “Since Tata Steel and the UK Government announced their bad deal for steel on the 15th of September, we have been clear that proposals to install a 3mt Electric Arc Furnace (EAF) are completely unacceptable. As Community and the GMB, our experts and Tata Steel all understand, the installation of a 3mt EAF Port Talbot inevitably means the end of the blast furnaces, major production cuts and thousands of job losses before 2027.”

Tata Steel

www.tatasteeleurope.com