More than 1,000 jobs at a troubled smelter have been secured after the federal government stepped in to keep it running with taxpayer support.
Rio Tinto, majority owner of the massive Tomago Aluminium plant near Newcastle, had for months been threatening to shut down due to spiralling energy costs.
But, on Friday 12 December, the Prime Minister announced it had come to an agreement with the minerals giant to keep it running after promising to use taxpayer funding to provide the smelter with cheaper power.
“It’s important we, as a nation, continue to make things here,” Anthony Albanese said during a visit to the Hunter.
“The program that we’ve been working on to ensure that long-term future is by giving security going forward.”
The full details of the arrangements are yet to be revealed.
However, it will also involve the NSW Government providing support and will underwrite new renewable energy generation, storage and transmission projects.
The total cost was yet to be agreed to, Industry Minister Tim Ayres said.
Tomago, which began production in 1983, produces more than a third of Australia’s aluminium, delivering 590,000 tonnes annually.
But, electricity makes up 40% of its operating costs.
The smelter is the single largest electricity user in the nation and consumes about 10% of power supplies in NSW.
The Australian Workers’ Union welcomed the announcement
“This is a pivotal moment for Australian manufacturing,” national secretary Paul Farrow said.
“For months, we’ve been saying that Tomago isn’t just another industrial site.
“It’s the test case for whether Australia is serious about having a manufacturing future.”
The announcement comes after a flurry of deals struck by the federal government to keep smelters running across the nation as rising energy costs threatened their sustainability.
In October, the Commonwealth and Queensland Government agreed on a $600 million joint support package for a copper smelter in Mt Isa.
A few months prior, the Australian, South Australian and Tasmanian governments stumped up $135 million in taxpayer funds to keep Nyrstar lead and zinc smelters operating, with part of the funding going to expand production into critical minerals such as antimony.
Rio Tinto has been contacted for comment.
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