Posco wants to upgrade Whyalla, increase capacity: industry minister

Image: Arrium

South Korea’s Posco is being mentioned as a potential saviour of the Arrium Whyalla steelworks, and, according to the federal industry minister, is considering an investment that would increase production by over 50 per cent.

As reported yesterday, industry minister Greg Hunt – as well as members of the Australian Workers Union and SA treasurer Tom Koutsantonis – was part of a delegation to the South Korean steelmaker.

According to The Advertiser, Posco has proposed a new steel plant at Whyalla, increasing production as much as 1.2 million tonnes, or more than 50 per cent. It use its Finex iron-making process (developed with Siemens).

According to the report it would also create a new plant to reuse gas made in steelmaking, feeding the power back into the SA grid.

“You couldn’t get a better outcome for South Australia,’’ Hunt told The Advertiser.

“Not just protecting the jobs but investing, expanding production and providing additional baseload (electricity) grid security.”

Administrator KordaMentha will not discuss any of the negotiations, though The Australian Financial Review reports that Posco is understood to be “driving a hard bargain” and seeking more government assistance than what’s currently available.

Arrium went into administration in April, with $4.3 billion in debts, and a new buyer is being sought for its steel and iron ore assets.