The steelworkers of a regional city need investment in green iron and green steel production not a bandaid on old technology, a state energy and mining minister says.
GFG Alliance’s Whyalla Steelworks on Monday announced it had cast its first steel following a four-month shutdown it attributed to operational challenges and extensive repairs.
Tom Koutsantonis said he was more concerned about creditors than the government’s balance sheet. (Morgan Sette/AAP PHOTOS)
“I hope we never go through this again,” South Australia’s Minister for Energy and Mining Tom Koutsantonis told reporters.
“The team working on restarting the blast furnace have been carrying the city on their shoulders for the last couple of months.”
Doubts remain about overdue royalty payments to the state government and whether local contractors will get the tens of thousands of dollars they are reportedly owed.
Two major rail freight operators Aurizon and Pacific National suspended services to the steelworks in late 2024 because of unpaid debts.
Mr Koutsantonis said he was more concerned about the creditors that live in Whyalla and the rest of the country than the government’s balance sheet.
He said he hoped it was a lesson for the operators of a furnace that needs to be run hard and continuously, not intermittently, and warned that the iron ore mining licence was linked to continuous operations.
Great news for Whyalla, with GFG Alliance casting its first steel in 4 months! Mayor Phill Stone said: “On behalf of Whyalla, I’d like to thank those committed steel workers who have battled tirelessly around the clock to achieve this major milestone.” https://t.co/uGt0VvGNFm pic.twitter.com/Y48NF8s82b
— City of Whyalla (@CityOfWhyalla) January 6, 2025
Iron ore is mined in the Middleback Ranges to feed the steelworks, bought by industrialist Sanjeev Gupta out of administration in 2017.
Whyalla was “the most strategic city in South Australia, if not the country” as its structural steel and iron production was vitally important to long-term economic sovereignty, the minister said.
But blast furnace technology was “old tech” and it was time to upgrade to direct reduction of iron and electric arc furnaces, which would mean the magnetite from the Middleback Ranges could be converted into green iron and green steel, he said.
“It’s what the world calls for – that’s the next step,” he said, urging the owners to understand its importance to the nation.
Sanjeev Gupta said rescuing the plant was “nothing less than a Herculean undertaking”. (Darren England/AAP PHOTOS)
State MP Eddie Hughes told ABC radio it had been “a very hard slog for the workers at Whyalla.
“The job losses that have occurred, the uncertainty about the future, have a profound impact on a community,” he said.
“But it looks as though there’s some real progress,” he said.
GFG’s executive chairman Mr Gupta said it had rescued the plant in “nothing less than a Herculean undertaking” but there was still a long way to go before the plant was stable and secure.
“We have deployed our best resources to rescue Whyalla and I am pleased to see the first real sign of progress towards our goal to return the plant to full production and then back to black,” he said.
Chief manufacturing officer Theuns Victor said the blast furnace was running at half its capacity with a number of issues yet tobe resolved.
“Despite this I am very confident we will deliver the plant to stability and then to its full capacity, but this will take time and patience,” he said.