‘Everyone in feels the pinch’: Whyalla Steelworks’ ongoing furnace repairs leave city in limbo

Workers at the Whyalla Steelworks are on reduced hours and pay as repair works to its blast furnace continue – with no completion date in sight.

Whyalla Steelwork employees are on reduced hours and 30 per cent less pay as repair works on its blast furnace continue, having already been offline for several weeks.

GFG Alliance confirmed the resumption of its steelmaking operations would be further delayed after the furnace shell was damaged this week during repair works.

The works came after the furnace cooled too much during a two-day maintenance shutdown in mid March, which caused blockages within the furnace’s wind tuyeres.

Australian Manufacturing Workers’ Union northern regions organiser Steve McMillan said up to 300 of the plant’s 1100 employees and contractors were affected.

Mr McMillian said furnace staff were normally on a day/night seven-day-a-week roster, but had been reduced to 38 hour week Monday to Friday.

“It’s frustrating for those people who are wearing the 30 per cent drop in wages, but there’s contractors who aren’t on site who have lost their complete wage,” he said

“It has flow-on effects to the whole town, people have less money to buy coffees, go to the pictures or buy clothes, so everyone in town feels the pinch.”

Billet steel at the Whyalla Steelworks. Picture: Ben Clark

Mr McMillian, who has been in the industry for 30 years, said the while the furnace shutdown wasn’t a regular occurrence, it did happen.

“It’s an ageing plant and any down time that’s not scheduled puts the longevity into question,” he said. “We’ve gone through this process before and recovered, but it’s a slow process.

“It takes two or three weeks to get back to normal production.”

British billionaire Sanjeev Gupta acquired the steelworks out of administration in 2017 and was heralded as a white knight for the town helping to save 900 jobs.

The steelworks is the only Australian supplier of long product steel and may force some companies to look overseas to fill its orders.

A GFG Alliance spokeswoman said to supply its customers they were using existing inventory and importing billet steel – a semifinished product cast from a furnace.

The spokeswoman said eight of the furnace’s 18 wind tuyeres had been reinstated, but refused to say how many were needed to restart the furnace and an expected completion date.

Energy and Mining Minister Tom Koutsantonis said the halt in operations was “not ideal” and the government had offered expertise to fix the issue, including to fly-in international experts.

Premier Peter Malinauskas toured the steelworks in February. Picture: Ben Clark

“We’ve offered the company any expertise they need no matter where it is throughout the world,” Mr Koutsantonis said.

“I know there is a blast furnace community internationally and interstate that are working to fix this problem and I have high confidence this can be fixed.”

He said the government had sent its own team of experts to inspect the operations and “reassure us everything we’re being told (by the company) so far is accurate”.

He dismissed questions on whether taxpayer funds would be needed to protect jobs and the supply chain – similar to when the previous operator, Arrium, was in administration.

Mr Gupta has an ambitious target for the steelworks to be carbon neutral by 2030, by replacing coal with hydrogen to make green steel.

The plan includes a new $500m electric arc furnace to process iron ore, with the federal government contributing $63m for its purchase and the state government promising $50m.

Mr Koutsantonis said Whyalla remained one of the most important towns in South Australia being its “industrial hub”.