More than 1000 jobs and operations at two smelters are under a cloud as governments and an international company butt heads over the dollar-figure of a fresh support package.
Taxpayer-funded help of $135 million to prop up Nyrstar smelters in South Australia’s Port Pirie and Hobart in Tasmania expired on Friday.
Weeks of talks have failed to reach an agreement on a new package, but South Australian Premier Peter Malinauskas said a revised offer would be put to Nyrstar by the end of Friday.
He was confident negotiations were moving in the right direction, but also said a failure to reach an appropriate agreement could have “very severe” consequences.
Under the previous package, announced in August, the federal government provided $57.5 million, South Australia $55 million and Tasmania $22.5 million.
The key point of difference during negotiations was the level of funding, Mr Malinauskas told reporters.
“We have to make sure that we’re not unnecessarily funding Nyrstar for operations,” he said.
“But at the same time we acknowledge there is a legitimate national sovereign challenge here.”
The Port Pirie and Hobart smelters, which combined produce lead, silver, zinc and other critical minerals, employ roughly 800 and 500 workers respectively.
All three governments were committed to maintaining a viable smelting industry, a spokesman for federal Industry Minister Tim Ayres said.
“Nyrstar’s Port Pirie and Hobart facilities are strategically important assets that fulfil a key role in Australia’s critical minerals future,” he said.
Tasmanian Premier Jeremy Rockliff said his government had put $7.5 million on the table during ongoing talks and was hoping for a resolution as quickly as possible.
Port Pirie had to remain an ongoing operation, Mr Malinauskas said.
“If we lose our smelting operations, we lose our ability to produce critical minerals and metals which we know the rest of the world needs,” he said.
Nyrstar Port Pirie general manager Darrin Cooper said important upgrades and production of the nation’s first antimony metal had been delivered since the August funding agreement.
“Disappointingly, despite this progress … we have not been able to reach agreement on the next phase and now have to consider all options for the business,” he said.
The August funding was to maintain ongoing operations and to allow a significant rebuild of the smelters and feasibility studies into critical metals production.
Tasmanian independent federal MP Andrew Wilkie said the situation was deeply concerning.
The survival of the Hobart smelter was important for hundreds of people and for Australia’s broader economic resilience and national security, he said.
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