Whyalla saviour Sanjeev Gupta’s powering ambition
He burst onto the scene as the saviour of Whyalla, but Sanjeev Gupta’s ambitions as an energy crisis power player go much further.
British billionaire Sanjeev Gupta burst into Australia as the saviour of Whyalla, breathing new life into its struggling steelworks. Now barely a month after relocating his young family from Wales to Sydney, he is rolling out ambitious plans to also become a major power player.
The 46-year-old head of Liberty House Group says while it is the former Arrium steel and mining assets that first caught his attention, he views Australia as a hub to develop mega projects across five verticals — steel, power, aluminium, mining and infrastructure — with several billions of dollars to be invested in each area. Expanding the capacity of the steel plant at Whyalla, in South Australia, is a priority, but power is a close second, with Gupta saying he had not fully appreciated the level of the energy crisis in Australia.
He says some of the energy issues in his new adopted country are similar to what he experienced in Britain, where instead of just complaining to government and asking for subsidies, he built his own power plants, which reduced his energy bills by up to 40 per cent.
“That has been a great liberator for us in the UK and has allowed us to become a significant player in the energy business,” he says.
“The opportunity in Australia is even greater because it is more broken.”
Gupta’s long list of business ideas rush out in hurried speech as his brain fast-tracks his vision — and his vision for an energy park, fuelled mainly by renewables, is one he is both passionate and excited about.
Talking to The Weekend Australian in the Bellevue Hill mansion in Sydney, which he calls home, Gupta says work has already started on his plan to generate power in South Australia through a combination of solar, wind, pumped hydro and battery.
Earlier this month, he bought a controlling 50.1 per cent stake in Ross Garnaut’s ZEN Energy renewable power and battery storage business in another step towards realisation of that project.
He wants a plant in Whyalla to produce 1000 megawatts of power, with the bulk of that to be generated by solar energy, making it the largest solar plant in the world. By comparison AGL’s proposed Liddell coal-fired plant in the Hunter Valley, which has come under intense political focus in recent weeks, has a capacity of just a little over 2000MW.
When Gupta’s proposed plant hits full capacity, the power it produces will be equivalent to around 40 per cent of South Australia’s current energy usage.
“Most of that power will be a surplus … we see that as a cheap source of energy in Australia and base load dispatchable energy, not just when the sun is shining,” he says. “Some of it we will use, some we will sell back into the gird and some we will encourage downstream investment, whether that is by us, or a third party.”
The father of three children under the age of six didn’t originally plan to relocate his family to Australia. He was meant to spend only a few months in the country after finalising the purchase of the Arrium consortium of companies. But as he left for the airport in England, his mind was filled with other opportunities in Australia and he surprised his wife, Nicola, with his relocation idea on the plane.
“It has been quite a journey already ... I’ve only been in the country six weeks,” he says.
“We have operations in 30 countries around the world ... I have a huge amount of pressure on me in terms of all the things we are doing globally, and I have chosen to come and live here and I’ve chosen to invest in Whyalla.
“It’s not for no reason, I believe it’s a great opportunity.”
Gupta says the immediate response from locals in Whyalla has been an “amazing feeling”, but it’s also “very sobering”.
“There is a lot of responsibility. These people are counting on you. If it fails, you’re not just failing yourself but you’re failing a whole town,” he says. “But I believe it’s doable, so it’s not a burden. I know I can do it. As long as the economic model is good, which I believe it is, you can’t go wrong.”
Following the completion of the Whyalla deal, he marched through the town with the workers and union and one of his customers said to him at the end of the march: “You can’t fail, you have 23,000 people blessing you and supporting you”.
“It’s a beautiful country, there’s so much opportunity here right now and it’s been very welcoming,” Gupta says. “I have had 100 per cent endorsement from everybody, so to have that force behind you is very powerful.”
The self-described workaholic says he was born working, with his first memory one of him as a toddler at his Dad’s steel plant.
Gupta, whose positive outlook is infectious, credits his Dad as a grounding force and major influence on him as a person. He laughs that his Dad mostly still flies economy, telling his family: “Don’t put me in a golden cage”.
“He says one man’s comfort is another man’s hell. Sometimes we persuade him, but he usually travels in economy, while my mother is in first class.”
Gupta adds that his dad doesn’t hold a lot of wealth and signed off all his businesses to his children a long time ago.
“He is an inspiration and has had a huge influence on me. He was my absolute hero growing up. It makes you work harder. It infects you, it’s a disease,” Gupta jokes of his dad’s positive influence. “My family and my work is what I spend all my time on.”
His first giant step into Australia saw him take control of 150 sites across the country, with 10,000 employees, 6000 of them directly employed.
Gupta says he plans to be chief executive of the business for the first 100 days before stepping back to let management run it, as he wants to focus on the mega projects he is planning in Australia.
Apart from his energy projects, he wants to expand the output at the Whyalla steel plant, beef up the port at Whyalla, develop other ports across the nation, purchase aluminium assets and develop a magnetite plant.
“For the next two to three years I have my work cut out,” he says.
Gupta says given Australia is blessed with natural resources and the potential is enormous.
He says people think that the Australian market is not big enough to pursue mega projects, which he says is not true.
Gupta believes technology and innovation will be a key liberator for Australia. “It is a high-cost environment, but you have to counter that with productivity and technology,” he says.
“I’m an eternal optimist. I see positive things in all problems. I see the only way to make a steel plant work in Australia is to have the best — to have the best technology, the best automation, the best productivity, the best of everything.
“When I talk to my guys about investing in anything, I say, what’s the best? That means you can be at the forefront of innovation.”
“I get up in the morning raring to go because I can see such a great journey ahead,” he says.
“It’s going to be amazing and we will make such a big difference to so many businesses and each of those businesses will make a fundamental difference, not for now, but for generations to come.”