Once-struggling steel city Whyalla rebuilds its prospects amid major steelworks, energy and school projects
A massive steelworks upgrade, major renewable energy projects and plans for a $100 million high school are helping turn fortunes around in the once-struggling town of Whyalla.
The wheels of change are slowly turning in Whyalla, with despair switching to optimism under an audacious plan for huge steelworks upgrades, landmark renewable energy projects and a $100 million school on the way.
Just two years ago, it wasn’t uncommon for residents to question their future in the Upper Spencer Gulf, as the owner of its steelworks went into administration, sparking flow-on effects for many businesses reliant on the plant.
But now, amid a raft of developments planned across the region, confidence is returning to the home of the giant cuttlefish.
This month, Sanjeev Gupta, whose company GFG Alliance took over the steelworks in 2017, touched down in the city to launch the GFG Foundation’s new ‘test-pilot’ program.
It involves high school children getting an insight into industry through a six-month work experience program, which the company hopes to roll out across the country.
Mr Gupta told locals he was investing in local youth in a bid to show them the opportunities manufacturing could bring in the 21st century.
And his optimism appears to be tricking down to many in Whyalla who are eager to see the steelworks prosper, but also recognise the city’s need to embrace other industries for the sake of its long-term security.
In Whyalla Norrie, Mint Cafe owner Nathan Head says he’s seen a 20 per cent rise in business compared with this time last year.
His separate catering company has also benefited from GFG’s takeover by serving food to hundreds of people at its functions.
Three years ago, when steelworks owner Arrium went into administration, Mr Head says he and his wife talked about potentially moving out of town.
“As far as Christmas shows for big companies, they just stopped having them,” he says.
“But we’ve already had people booking in Christmas shows for this year and we get a lot of corporate money spent in the cafe on a daily basis.
“Things have definitely turned around.”
In December, Mr Gupta headlined a “big reveal”, announcing plans for a “next-gen, mega-steel plant” backed by the signing of $600 million in contracts to upgrade the current steelworks.
Also announced on the day was a $145 million intensive horticulture project; a new $45 million hotel on the foreshore to be built by the Pelligra Group, owners of the Holden site in Elizabeth, and; a $6 million green organics recycling plant to be built by Peats Soil and Garden Supplies.
SIMEC Energy, majority-owned by GFG Alliance, is gearing up to start work on the $350 million Cultana Solar Farm outside of Whyalla.
The city’s jetty is getting a $7.8 million upgrade in a bid to cater for local fishers and tourists alike, and businesses will also get a boost when MIMP Connecting Solutions rolls out its new high-speed internet this year.
Mr Head says some locals are sceptical about GFG Alliance’s plans and how much of Mr Gupta’s ambitious vision will see the light of day.
“In my opinion, a lot of people thought it was just going to happen really quickly, but it’s going to take time,” he says.
“There’s a lot of work to do out there at the steelworks to make it profitable again.”
While optimistic about the future, Mr Head believes it is unlikely Whyalla will see its population quadruple to 80,000 by 2040, as was predicted at the big reveal in December. The changes would make Whyalla South Australia’s biggest regional city by a country mile. “I think it’s great to have that dream but I can’t see it being that big,” Mr Head says. But another 10,000 to 15,000 people here would be amazing.”
Over the past 12 months, the median house price in Whyalla has gone up 5 per cent to $156,500, with 224 homes sold in the council district.
That growth is almost double the increase recorded in the Greater Adelaide area, where prices went up 2.8 per cent to $455,000.
Elders Whyalla branch manager Graham Taylor says there’s no doubt confidence is returning to the local market.
“There’s still a lot of activity at the lower and mid tier, but people are committing now to some of the more expensive homes,” he says.
“People are also thinking they can sell their homes now, instead of being quite forlorn and thinking their homes will sit there (on the market). People are buying without fear of any major downturn in Whyalla.”
The renewed confidence has not been solely due to GFG Alliance’s investment in the area. It has come alongside the region’s push to diversify employment options, through sectors such as tourism and renewable energy projects. “We’re trying to remove the tag of being an industrial city,” Mr Taylor says.
Matthew Wauchope is among locals making the most of a move towards new industries, having previously worked at Whyalla’s steelworks.
His company, DCD Electric, has a large focus on local renewable energy projects and has a base in the University of SA’s new Innovation & Collaboration Centre in town. The company also does power system engineering consulting work.
“The town is still dependent on the steelworks and mining, but these (renewable) projects being successful will definitely increase confidence in the area,” Mr Wauchope says. “The Cultana solar farm is pretty exciting for someone like me to have in our backyard.”
The innovation hub provides an office space and a platform to help develop his ideas and seek business advice.
At Aquest Electical, owner Darren Hage says a few years ago about 90 per cent of his company’s business came from work associated with the steelworks – placing it in a vulnerable position as work dried up when Arrium went into administration during 2016.
He’s made an effort to reduce reliance on the plant, having taken on contracts with government departments in an effort to be more risk-adverse.
The company has also expanded the refrigeration work it takes on and now has a total of 40 staff compared with about 20-25 three years ago.
Mr Hage hopes Aquest will find extra work helping set up infrastructure to support the Cultana project and establishing Whyalla’s new $100 million high school, which is due to open in 2022.
The State Government last month held an industry briefing on the school project to provide local companies with information on how they might be able to get involved. Aquest refrigeration manager Kevin Sims says he was among about 100 people at the meeting, all hoping to win their next big project.
Stav Larcombe’s children Dimitri, 14, and Addisyn, 9, will attend the new school.
“I think the fact that it will be a brand new school with brand new resources will be great for the town and will potentially attract more families to come to Whyalla,” Mrs Larcombe says.
She says optimism in her community is on the way up following previous uncertainty over the steelworks’ future, job losses and pay cuts.
“It was very stressful there for a little while, about whether your husband is going to have a job or not and a lot of family (members) and friends were in the same boat. But at the moment, everything is pretty positive.”
Whyalla Mayor Clare McLaughlin says she’s seen a noticeable increase in job advertisements in town since 2017, and employment will be further boosted once businesses and projects start up or reach full operation.
“The Liberty next-gen mega plant would be the largest in the western world, capable of producing 10 million tonnes per year, with the ability and infrastructure to double capacity in time,” she says.
The new school, too, will be a “massive” project for Whyalla, employing more than 600 people during construction.
Education Minister John Gardner says the new school will combine Edward John Eyre, Stuart and Whyalla high schools, with work beginning early next year.
“Located between the UniSA and TAFE facilities, the school will create an education hub that will provide students with access to more resources,” Mr Gardner said. “Whyalla’s next generation will be able to experience the same environments found in modern workplaces and leading tertiary institutions, preparing them for life beyond school.”
BIG SOLAR PROJECT A BOOST FOR WHYALLA
Work on Australia’s biggest solar farm will begin in Whyalla within weeks, GFG Alliance executive chairman Sanjeev Gupta says.
About 350 people will find work building the $350 million Cultana Solar Farm.
“We’ll do groundbreaking on that project very soon,” Mr Gupta told The Advertiser.
“We’re on track to complete and power on either late next year or the year after.
“That’s good because it gives us a reduction in energy prices, which is critical to all the other things we’re doing.”
The project is part of the company’s $1 billion energy plan.
GFG Alliance also wants to build the world’s largest lithium-ion battery at Jamestown, cogeneration at the Whyalla Primary Steel plant using waste gas, and pumped-hydro projects at its Middleback Ranges mining operations.
The company has already signed $600 million in contracts to upgrade the current steelworks, with work beginning either later this year or early next year.
It includes a new rail and structural heavy-section mill and a pulverised coal injection plant.
Meantime, the company has also been working on a 12-month feasibility study to build the “next-gen, mega steel plant” – one of the biggest steelworks in the world.
Mr Gupta said that study would be complete this year, and the project itself would take about four or five years to build – but it was too early to say when that might happen.
“Next-gen is enormous – we’re talking about $10 billion-$15 billion,” he said. “But the first priority is the existing plant.”
Returning to Whyalla this month, Mr Gupta said turning around the steelworks’ fortunes would not be a “quick fix” but the local community had already proven its resilience.
“They’ve been through such a tough time,” Mr Gupta said.
“One of the things that inspired us to invest here was the willingness to continue fighting and not get fatigued quickly.”
POWERING THE CITY
■ August 2015: Whyalla steelworks owner Arrium announces $1.9 billion loss for the 2014-15 financial year.
■ April 2016: Arrium placed in voluntary administration with debts exceeding $4 billion.
■ June 2016: State Government pledges $50 million to help find a buyer.
■ August 2017: GFG Alliance buys the failed Arrium business.
■ December 2018: GFG Alliance executive chairman Sanjeev Gupta hosts a “big reveal” in Whyalla, which spells out his company’s plans to upgrade the town’s current steelworks, build a new “next-gen” plant and a range of renewable energy projects.
■ August 2019: Mr Gupta’s GFG Foundation announces a test-pilot program in Whyalla to introduce high school students to industry.
michelle.etheridge@news.com.au