An in-principle agreement to save Alcoa’s Portland aluminium smelter has been reached between the Victorian government and AGL, which could potentially turn things around for the beleaguered aluminium smelting project.
According to the AFR, the parties agreed on $200 million agreement on the price and terms of electricity provision for the smelter.
The Victorian government will provide $200 million over four years to keep the plant running and the federal government will provide a supplementary loan of $40 million to help the plant reach full output again.
Currently, the Portland smelter employs 540 people directly and about 2000 indirectly. A blackout in December led to the forced closure of one of the potlines.
If the plant reopens, production is expected to be 30 per cent below original output. Alcoa is still yet to decide on whether to continue to run all of its facilities or close altogether.
Australian Workers’ Union national secretary Daniel Walton and the smelter “desperately needs certainty on power supply if we want to get things back online and save the local economy”.
“AGL carries a very serious weight of responsibility here,” Mr Walton said.
“Building the smelter in Portland gave AGL the security to establish its network across the region. Now the smelter, in its hour of need, requires AGL to come to the party. We are very hopeful AGL understands what is at stake.”