British Steel coke oven closure would impact Liberty

The potential closure of Scunthorpe-based British Steel's coke ovens could be a major problem for nearby Liberty Merchant Bar (LMB), which is powered by coke offgases from the integrated mill.

British Steel supplies coke oven gas, as well as billet, to the beleaguered site, which has not been running properly amid Liberty's recent financial issues and restructuring.

British Steel is meant to give LMB 12 months' notice for discontinuation to gas supply, but sources close to Liberty said it was advised much more recently.

A Liberty spokesperson refused to comment, but sources close to the company said LMB was aware of the situation and is reviewing its options. To reconfigure the LMB rolling lines and reheat furnaces away from coke-oven fed gas to natural gas would be expensive and time-consuming, sources say.

British Steel is considering stopping its coke ovens to reduce the amount of carbon emissions allowances it has to buy — they could be stopped as soon as June, according to sources with knowledge of the situation.

British Steel at present is running two blast furnaces to feed its rolling operations, according to a company spokesperson.

"Unfortunately, like many other businesses, we are reluctantly having to consider cost-cutting in light of the global recession and increased costs," the spokesperson said.

"We have discussed this in preliminary talks with the trade unions in which we shared the challenges we face. We look forward to working closely with them to ensure a long-term safe and sustainable future for the company, thousands of employees and many more in people in our supply chain."

By Colin Richardson