Premier Peter Malinauskas reminds Whyalla steelworks’ owner GFG Alliance directors over following laws

Premier Peter Malinauskas has issued a direct reminder to directors of Whyalla steelworks owner GFG Alliance over unpaid debts.

Premier Peter Malinauskas has directly reminded directors of Whyalla steelworks owner GFG Alliance to ensure they are not breaching laws by failing to pay debts and trading while insolvent.

Asked in parliament whether the state government intended to force GFG Alliance into administration, Mr Malinauskas issued a blunt reminder to the firm’s directors about their corporate legal obligations as the steelworks’ owner.

GFG Alliance executive chairman Sanjeev Gupta on Monday said the Whyalla steelworks was turning over $13m-$14m per week, and he hoped the operation would be breaking even by mid-year, after being at “death’s door” in recent months.

Responding to Opposition questions about his message to GFG creditors, Mr Malinauskas branded the steelworks’ future “one of the more complex public policy challenges the state has seen in decades”.

Premier Peter Malinauskas on Monday stands on Hummock Hill Lookout in Whyalla, overlooking Whyalla steelworks. Picture: Brett Hartwig

But Liberal energy spokesman Stephen Patterson accused the Premier of being “totally distracted by a green hydrogen promise” for a Whyalla plant that had blown out in cost by more than $450m.

Mr Malinauskas pointedly reminded GFG directors that they were “a legal entity and they’ve got laws that they need to abide by”.

“The obligation, first and foremost, is on the directors of GFG. The Corporations Act outlines very clearly, in a way that is not open to interpretation, the obligations on directors of companies in this country,” the Premier told parliament.

“ And the obligations on those directors include ensuring that they are trading in a way that is solvent, that is to say that debts are being paid, as and when they fall due.

“And we would simply submit to GFG, along with any other company that operates within the state of South Australia, that they should honour their directors’ duties under the Corporations Act and the law of the land.”

A GFG spokeswoman said the directors were “very conscious of and are complying with their duties”, adding this had been made clear in multiple statements.

“The directors are fully focused on continuing to progress the business turnaround at the Whyalla steelworks,” she said.

Whyalla businesses on Monday said they would not believe Mr Gupta’s promise to get things back on track until the GFG Alliance chairman “shows (them) the money”.

Sanjeev Gupta in his Adelaide office in October, 2024. Picture Mark Brake

In parliament on Tuesday, Mr Patterson cited figures from the CSIRO’s draft 2024/25 GenCost report to argue hydrogen electrolyser costs had surged by 41 per cent in the past year, driving up the production cost per megawatt.

This meant the electrolyser for Labor’s proposed Whyalla hydrogen power plant would cost $676m, not $220m as claimed – or more than the entire $593m budgeted for the project.

“So this massive $456m blowout sends the project surging past $1bn for a hydrogen power plant that will not bring down household energy bills for struggling South Australians,” Mr Patterson said.