The Port Kembla steelworks has increased measures to prevent a shutdown that would have irreversible consequences for several sectors. Picture: AAP/Dean Lewins
The Port Kembla steelworks has increased measures to prevent a shutdown that would have irreversible consequences for several sectors. Picture: AAP/Dean Lewins

Steel giant’s dire warning amid shutdown fears

Workers turning up to the Port Kembla steelworks are having their temperatures taken at the boomgate as BlueScope Steel steps up measures to keep coronavirus off site.

However, the ASX-listed steelmaker wants a guarantee from the NSW government that its operations will not be forced to shutdown, a move that it says will lead to the loss of thousands of jobs while also potentially seeing the closure of site.

BlueScope corporate affairs manager Michael Reay said it cost up to $700 million to turn off the blast furnace while also requiring months of preparation to do it safely.

 

The Port Kembla steelworks has increased measures to prevent a shutdown that would have irreversible consequences for several sectors. Picture: AAP/Dean Lewins
The Port Kembla steelworks has increased measures to prevent a shutdown that would have irreversible consequences for several sectors. Picture: AAP/Dean Lewins

 

The time and cost of the shutdown could make it economically unviable to re-open the steelworks, he said.

BlueScope contributes over $10 billion of output in NSW, accounting for almost 1 per cent of NSW gross state product.

 

It is understood it is among a number of the State's larger employers that have made representations to the federal and state government on the impact a closure would have on the economy.

 

Thousands of BlueScope employees are at risk. Picture: The Australian
Thousands of BlueScope employees are at risk. Picture: The Australian

 

The appeal by BlueScope follows the shutdown of its operations in New Zealand for a month.

"Don't do a New Zealand on us and say look we have to shut everything down because if we turn it off, there goes steel making in Australia," Mr Reay said.

"The damage the investment means it would be uneconomic for it come back on."

A shutdown would also impact critical oxygen supplies to NSW, Victorian and Queensland hospitals with gasses a by-product of steelmaking.

The gasses, which also include nitrogen and argon, are supplied to Coregas, which distributes to hospitals.

 

 

In NSW, BlueScope provides up to 80 per cent of total oxygen supply to hospitals, much of which is utilised in intensive care units.

In its representation, BlueScope has asked that its role in hospital gas provision enable it to be given "critical medical supply" status.

Blast furnaces are not designed to shut down, running continuously for the 20-year lifespan.

Shutting down results in the hot metal in the furnace solidifying, resulting in significant damage to the furnace.

 

Hospitals around the country rely on critical medical supplies produced by the steelworks. Picture: The Australian
Hospitals around the country rely on critical medical supplies produced by the steelworks. Picture: The Australian

 

BlueScope estimates that it would take two months to shut the furnace safely without risk to employees or the environment.

The last time it was shutdown in 2011 took two months.

BlueScope argues that a shutdown would have a knock-on effect in the domestic construction industry jeopardise the construction industry, with much of its product used locally.

It is also supplying steel for national strategic defence projects, including the new

submarines, naval vessels and armoured vehicles. builds and other defence projects.

Originally published as Steel giant's dire warning amid shutdown fears


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