West Gate Tunnel steel deal breaks Premier’s local content vow

A builder will import 33,000 tonnes of Chinese steel to construct one of Melbourne’s biggest road projects in a move tipped to “go off like a bombshell” in the local steel industry and cause chaos on the project.

Piling rigs digging and building the early works of the West Gate Tunnel last year.

A deal to import 33,000 tonnes of Chinese steel for the West Gate Tunnel will torpedo Premier Daniel Andrews’s local content pledge and threatens to cause chaos on the project.

Shanghai Zhenhua Heavy Industries (ZPMC) announced online it would be making its “first entry” into the steel bridge market in Australia, after striking a contract with the $6.7 billion Tunnel’s builder — a group made up of CPB Contractors and John Holland.

The Australian Workers’ Union has labelled the announcement, posted via digital networking site LinkedIn, a “disgrace” that breaches a guarantee for 92 per cent local steel on the project.

The government is blaming tight timelines for the backflip, saying the project still uses more local steel “than almost any other single project underway in Australia”.

But it comes after Premier Daniel Andrews returned from China last month trumpeting his government had delivered on local content commitments including “around Aussie steel”.

“We can do more than one thing at the same time, if you work hard and you are committed,” he said last month.

Premier Daniel Andrews and West Gate Tunnel Project chief executive Peter Sammut. Picture: Andrew Henshaw

State secretary of the AWU, Ben Davis, said it was “not too late to fix” the issue but accused John Holland and the State Government of “running for cover” instead of explaining decisions to industry.

“This announcement will go off like a bombshell in the steel industry, where they have been making investment decisions based on agreements made,” he said.

A government spokeswoman said the state was “using more Australian steel than ever before as we get on with our big build” and that the WGT still delivered a “boom to local steel suppliers”.

West Gate Tunnel Project chief executive Peter Sammut said contracts for 135,000 tonnes had been awarded to Australian suppliers, and that the “project has sought to use Australian steel wherever possible”.

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The Tunnel, proposed by tolling giant Transurban, will connect the West Gate Freeway to CityLink with tunnels as long as 4km, and a bridge over the Maribyrnong River.

ZPMC, which is state-owned in China, says on its online announcement the project is part of “the western Virginia State of Australia”.

It says that the structures is set to build “will be constructed in accordance with the requirements of Australian standards”.

The Herald Sun contacted CPB John Holland for comment.

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