IANS | 18 Sep, 2023
Tata Steel and the UK government on Friday announced a joint
agreement on a proposal to invest 1.25 billion pounds in
state-of-the-art Electric Arc Furnace steelmaking at the Port Talbot
site in Britain. The investment includes a grant of 500 million pounds
from the UK government.
The project will bolster UK's steel
security and it will be the first major step towards decarbonisation of
the local steel industry, reducing direct emissions by 50 million tonnes
over a decade.
Tata Group Chairman N. Chandrasekaran said: "The
agreement with the UK Government is a defining moment for the future of
the steel industry and indeed the industrial value chain in the UK. It
has been an absolute pleasure to work with His Majesty's Government and
Prime Minister Rishi Sunak in developing the proposed transition pathway
for the future of sustainable steelmaking in the UK."
With a high
degree of circularity the project would leverage strategic,
domestically available scrap steel and promote local value addition
within the UK.
Tata Steel UK will soon commence consultation on
the proposal and the transition period including potential deep
restructuring for the carbon-intensive, unsustainable iron and
steelmaking facilities at Port Talbot, where many of the existing 'heavy
end' assets -- such as blast furnaces and coke ovens -- are reaching
the end of their operational life.
The proposed project would also
involve Tata Steel's Balance Sheet being restructured with potential
elimination of the current cash losses in the UK operations and non-cash
impairment of legacy investments.
During the transition period
and project phase, Tata Steel UK would work intensively to ensure
uninterrupted and reliable supply of products to fulfill customer and
market commitments including through import of additional steel
substrate from stable supply chains to feed its downstream units.
Steel's Chief Executive Officer and Managing Director, T.V. Narendran
said: "Tata Steel UK has been facing significant challenges due to the
heavy end facilities approaching their end of life. The proposed
project, with one of the largest investments in the UK Steel Industry in
recent decades, provides an opportunity for an optimal outcome for all
stakeholders. We will work to transform Tata Steel UK into a green,
modern future ready business."