Liberty Whyalla blast furnace down after maintenance

: Metals
24/04/16

GFG Alliance is negotiating with workers at its Whyalla plant in Australia for "short-term" options as its blast furnace experienced operational and technical issues after maintenance work last month.

Suppliers of the plant told Argus in late March that the blast furnace was experiencing issues.

"Ageing assets like the blast furnace will eventually be retired as part of the Whyalla Steelworks transition to new technologies," a GFG spokesman said. "Plans are being developed to safely continue productivity of the blast furnace and, more broadly, the Whyalla Steelworks, as well as enable a more sustainable future."

"GFG remains committed to returning the blast furnace safely to operational use," he added.

GFG is a collection of entities including Liberty Steel.

Whyalla has a production capacity of about 1.2mn t/yr, with about two-thirds of that cast into billet and sent by rail to GFG's Infrabuild business for processing into longs. Under the agreement between the two plants, payment from Infrabuild to Whyalla can be made before delivery.

Infrabuild raised $350mn through a bond sale towards the end of last year at an interest rate of 14.5pc.

Meanwhile, Liberty remains in talks with the Czech government over the emissions allowances for its Ostrava site. The Czech Ministry of Environment wants proof that Ostrava will produce again before granting free allowances to the site, and the significant change in its operating rates mean the company may not receive those allowances until June or July — its restructuring plan envisages selling a portion of those allowances in May. The idling of the blast furnace since October, and the stoppage of coking facilities at the site, also impacts the number of allowances that will be granted. Sources suggest coking is unlikely to restart, meaning there will be no allowances granted for the facility, while there is also concern about when the blast furnace may restart.

"The EU emissions trading system is a complex system which is designed to avoid interference in the distribution of the allowances and the calculations of the emissions," a Liberty spokesperson said. "This system governs about 11,000 companies across the EU and Liberty Ostrava only expects to be treated in the same way as all the others."

By Colin Richardson

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