Albanese pledges major bailout of two smelters to secure processing, critical minerals future
Taxpayers will dig deep to save two struggling metals smelters in two states, with Anthony Albanese saying a rescue plan ‘is very close’.
Taxpayers will “very soon” underwrite a major bailout of two failing metal smelters in two states, as the Albanese government seeks to shore up the nation’s manufacturing and critical minerals capacity.
Prime Minister Anthony Albanese on Tuesday confirmed an imminent rescue package for two ageing Nyrstar smelters – Hobart’s zinc refinery and its lead smelter in Port Pirie, South Australia.
Nyrstar, owned by Singapore-based multinational Trafigura, has warned both interrelated smelters are “touch and go” financially, placing at risk the jobs of about 1500 workers and the nation’s smelting capabilities.
Mr Albanese, in Hobart to campaign for Labor ahead of the July 19 state election, said his government was working with both sides of Tasmanian politics, and with the South Australian government, on a combined package.
“These manufacturing facilities are really important for our national interest and that’s why we’re working with the company, with state and territory governments as well,” he said.
“It (a rescue plan) is very close… I would hope that there would be an announcement soon. I know that it will enjoy bipartisan support here in Tasmania, so the election should not interfere with any of that.”
Nyrstar – backed by industry groups – has argued the smelters are no longer able to compete with subsidised Chinese production.
The company has pitched the importance of the plants to Australia’s sovereign smelting capacity and the potential for them to adapt to produce critical minerals.
A recent report by economic consultancy Mandala warned it would be difficult for Australia to recover its smelting capacity if the plants were lost.
The report also highlighted that lead and zinc processing was an essential precursor to producing critical minerals.
It is understood Nyrstar could adapt its processing to produce five of Australia’s critical minerals – antimony, bismuth, tellurium, germanium and indium, considered key in defence, clean energy and hi-tech products.
Both plants are old and in need of an upgrade. The Hobart zinc refinery, which recently cut production, is almost 110 years old, while Port Pirie is 134 years old.
Nyrstar has suggested a role for government ownership of the smelters, while those pushing a bailout have suggested the federal government could focus on upgrades, while state governments deliver tax holidays.
Mr Albanese on Tuesday did not detail what form of assistance was being considered in the talks, but said it would be on top of $70m already provided by the federal and Tasmanian governments to the zinc refinery.
“We want to make sure Nyrstar gets the support that it needs,” he said.
He also confirmed the government’s interest in ensuring the future of the troubled Bell Bay aluminium smelter, in Tasmania’s north.
Tasmanian Liberal Premier Jeremy Rockliff said it was important for the two state and federal governments to work together to save hundreds of jobs and vital industries.
The Australian Workers’ Union called on all three governments to do whatever necessary to secure the plants’ future.
“The cost of not providing support to the community is far greater that any support they provide,” AWU assistant secretary Robert Flanagan said. “The footprint on the Tasmanian economy from the Nyrstar smelter is huge.”
Other businesses, including one of Australia’s last fertiliser manufacturers, depended on the Hobart smelter, he said.
Nyrstar could play a key role in securing the nation’s critical minerals. “Nyrstar is saying that with some new equipment and technology, they would be able to produce critical minerals as a part of their production process,” Mr Flanagan said.
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