GFG Alliance has entered into a binding sale and purchase agreement with an entity owned by South32 Limited and Anglo American Plc for the Tasmanian Electro Metallurgical Company (TEMCO) smelter in Bell Bay, northern Tasmania, which is powered by hydroelectricity.
Subject to relevant approvals, TEMCO will join Liberty Steel Group, part of the GFG Alliance family, which includes the Whyalla steelworks, SIMEC Mining and InfraBuild in Australia. This will secure the site’s 250 jobs.
The TEMCO facility has the capacity to produce about 150ktpa of high-carbon ferromanganese and 120ktpa of silicomanganese, which is used in the production of steel. Liberty Steel Group is the eighth largest steelmaker in the world outside China and purchases a significant volume of ferro alloys every year for its global steelmaking operations. TEMCO is a supplier to LIBERTY’s Australian operations.
GFG Alliance Executive Chairman Sanjeev Gupta said the TEMCO facility will strengthen its steel making capability in Australia and globally. “By investing in key inputs, such as ferromanganese and silicomanganese we are able to generate value across the supply chain to ensure Australia has a sustainable and globally competitive steel manufacturing sector,” he said. “It will also help neutralize the volatility in the markets, providing us a reliable supply at a stable cost.”
Gupta said the acquisition is in line with his strategy to further expand his GREENSTEEL strategy and complements his goal to be carbon neutral by 2030, known as CN30.
“By embracing Tasmania’s plentiful supply of renewable energy, particularly the ability to power the submerged arc furnaces from Hydro Tasmania, the TEMCO facility will support our goal to be carbon neutral by 2030,” he said. “Ferromanganese and silicomanganese will continue to have a role as important inputs for making steel products. The fact we will be able to produce these inputs using renewable energy is a real boost to our GREENSTEEL strategy.”
Robert Evans, General Counsel and Head of Business Development at GFG Alliance who led this transaction, said: “It’s most rewarding to be involved in a transaction by which GFG can ensure the sustainable future of this business and establish a platform in Tasmania for future growth and investment”.