Whyalla’s steelworks faces a prolonged gap in steelmaking after administrators confirmed the site’s 60-year-old blast furnace will not be restarted. KordaMentha said about 500 employees and 100 labour-hire workers would lose their jobs following the furnace’s closure, while the position of another 200 embedded contractors remains unclear.
The blast furnace has been offline since April, but its problems had developed over several years. KordaMentha partner Sebastian Hams told ABC News the furnace would go completely cold because there was not enough air to carry out a controlled blow-down, making an attempted restart unfeasible.
A future owner is expected to replace the coal-fired furnace with an electric arc furnace, which uses plasma to melt scrap. Estimates for the transition range from two to four years. Whyalla Mayor Phill Stone said the city would continue rolling rail steel during the interim, but would need to bring steel into the mill to support that activity.
Stone said the abrupt end of the furnace’s operating life had arrived sooner than expected. He warned that some families could consider relocating, although he also pointed to employment opportunities elsewhere in the region and in South Australia’s north.
Jindal Steel and M Resources are still bidding to buy the steelworks, while BlueScope Steel retains a right of last offer. Treasurer Tom Koutsantonis said a return to steelmaking depended on the successful bidder, arguing that the selection process should focus on the capability to operate the site rather than simply the highest price.
Koutsantonis said he expected steelmaking to return within the next couple of years. Journalist and author Paul Barry was more cautious, telling ABC News that three years was a more likely minimum if a sale was completed soon. The South Australian and federal governments have announced worker-support measures as the region confronts the immediate economic impact of the closure.