Tata Steel has proposed an additional financial 'support package' of around 130 million pounds for the workers who would be affected as part of its transition plan in the UK, the company's CFO Koushik Chatterjee said.
Tata Steel commits over £130M to support Port Talbot workers in the UK amid a major transition to eco-friendly steel production.
Tata Steel has proposed an additional financial 'support package' of around 130 million pounds for the workers who would be affected as part of its transition plan in the UK, the company's CFO Koushik Chatterjee said.
To reduce carbon emissions and save energy costs, the company drafted a decarbonisation plan for Tata Steel UK which includes installing new plant machinery with low-emission technologies.
Accordingly, the company would close both the high-emission blast furnaces and coke ovens in a phased manner in 2024 and shift to an (electric arc furnace) EAF-based steel making at a cost of about 1.25 billion pounds, with 500 million pounds support from the UK government, Chatterjee said in an earnings call.
"Tata Steel is acutely aware of the impact of its proposal to wind down the heavy end of Port Talbot on the individuals and on the local community associated with our steel works, and we will meaningfully consult with our employees and work to provide them a fair, dignified, and considerate outcome," he said.
Tata Steel proposes to commit in excess of 130 million pounds to a comprehensive support package for the affected employees, the CFO said.
This is in addition to the 100 million pounds funding for the Transition Board set up by the company along with the UK and the Welsh government, in which the company has contributed GBP 20 million, he said.
Tata Steel CEO & MD T. V. Narendran said, "We have tried very hard for the last 15 years to support this (UK) business. But I think we have reached a stage where continuing as we did, is no longer an option." "It is a difficult situation for our employees. We fully empathise with that," he said.
Tata Steel UK will be closing its first blast furnace by mid-this year while the second furnace is planned to be shut down in the second half of 2024, he said.
The transition to EAF-based steel-making will save 50 million tons of CO2 emissions over a decade, Narendran said.
India-headquartered Tata Steel owns the UK's largest steelworks at Port Talbot in South Wales and employs around 8,000 people across all its operations in the country.
In September 2023, Tata Steel and the UK government agreed on a joint investment plan of 1.25 billion pounds to execute decarbonisation plans at the Port Talbot steel-making facility in Britain.