‘Open your books’ before we consider bailout, feds demand of Gupta’s smelter

The Albanese government is demanding Sanjeev Gupta’s GFG open its books before it considers demands for another taxpayer bailout, of a GFG manganese smelter.

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The Albanese government is not ruling out a multibillion-dollar bailout of Australia’s only manganese smelter but is demanding Sanjeev Gupta’s GFG Alliance first “open its books” for scrutiny.

Federal Industry Minister Tim Ayres late on Tuesday told The Australian he was “deeply concerned” about GFG’s financial position and questioned its claims of an ongoing ore supply shortage.

The government is under pressure to match the $2.4bn bailout of GFG’s Whyalla steelworks with a similar rescue package for Liberty Bell Bay, in northern Tasmania.

Senator Ayres would not rule that out, dismissing it as “hypothetical”, but said GFG must first “open its books” so that the state and federal governments could properly assess the situation.

“What I want to see is Liberty management and their parent company (GFG) in Hobart in front of the Tasmanian government – supported by the federal government – with open books and a clear plan to resume production,” he said.

“There are hundreds of Tasmanian workers and contractors engaged here. It’s an important facility that has received significant support from the community and successive governments.

“They owe it to Tasmanians to be really clear about the state of the business.”

Liberty Bell Bay manganese smelter. Picture: Pool/ABC

GFG has primarily blamed plans for a one-month shutdown at the plant, which employs 250 in the marginal seat of Bass, on disruption to ore from GEMCO in the Northern Territory, due to cyclone damage. However, GEMCO has said ore shipments are this week resuming, following the rebuilding of its Groote Eylandt wharf, and Senator Ayres questioned GFG’s justification.

“It’s clear to me that there is a resumption of manganese ore production ready to supply to this business the moment that they start arranging shipping,” he said. “It is clear that there is workforce ready to return to work. What’s lacking is transparency and a clear plan from Liberty Bell Bay and their parent company.”

GFG has said it is yet to secure an allocation of ore from GEMCO but is yet to respond to concerns it may lack the working capital to do so. GEMCO, understood to have normal quantities of ore available to supply Bell Bay from July, suggested supply disruptions from last year’s cyclone were not sufficient reason for the Tasmanian smelter to shut down.

“Supply of manganese ore has been available elsewhere during GEMCO’s outage, for example from South Africa or Gabon,” said a spokesman for GEMCO’s owners, South32. “With GEMCO now having resumed export sales from Groote Eylandt, we are engaging with all of our customers, including Liberty Bell Bay, regarding orders of manganese ore.”

British businessman Sanjeev Gupta. Picture: AFP

GFG did not respond to requests for comment.

Tasmanian Premier Jeremy Rockliff demanded Anthony Albanese commit to providing Bell Bay with the same kind of multibillion-dollar bailout given to the Whyalla steelworks, if needed.

“I made it clear to the Prime Minister that Tasmania expects the federal government to play a pivotal role in securing supply chain opportunities, acknowledging their Future Made in Australia policy, which seeks to strengthen sovereign capability,” he said. “The federal government’s critical minerals strategy lists manganese, and the US also designates manganese as a critical mineral.”

Mr Rockliff said Bell Bay should be “afforded the same opportunities that were offered to other smelters” should assistance be needed to save the plant.

The Australian Workers Union said it had been informed the smelter would pause production from June 16 to July 13, with staff forced to take leave.

Senator Ayres said he shared the union’s concerns that many staff may lack sufficient accrued leave to cover any shutdown at the plant, operational since 1962.