UK gov agrees to support Tata Steel’s investment
2 min read 16 Sep 2023, 12:36 AM ISTIn a media statement issued on Friday, the company is expected to receive a grant from the UK government of up to 500 million pounds.
PremiumNew Delhi: Tata Steel today said that the UK government has agreed to support their planned investment of 1.2 billion pounds to improve infrastructure at the plant in Port Talbot.
In a media statement issued on Friday, the company is expected to receive a grant from the UK government of up to 500 million pounds. The partnership is aimed to develop ecologically sustainable steel production and will be the largest investment proposal received by the UK steel industry in several decades.
"The proposed investment will preserve significant employment and presents a great opportunity for the development of a green technology-based industrial ecosystem in South Wales. We look forward to working with our stakeholders on these proposals in a responsible manner," Tata Group Chairman N. Chandrasekaran said in a statement and called the agreement a 'defining moment' for the future of the steel industry in the UK.
The development comes at a time when heavy industries worldwide are moving towards ecologically sustainable projects with reduced carbon emissions, and green energy takes centre stage.
The development is expected to revive Tata Steel’s business in the UK, which has been facing significant challenges. “Tata Steel UK has been facing significant challenges due to the heavy-end facilities approaching their end of life. The proposed project, with one of the largest investments in the UK Steel Industry in recent decades, provides an opportunity for an optimal outcome for all stakeholders," said T. V. Narendran, chief executive officer of Tata Steel.
In the press statement, Tata Steel reiterated that it would undertake meaningful consultations with employee unions on the proposed transition.
“With the support of the UK Government and dedicated efforts of the employees of Tata Steel UK, along with all stakeholders, we will work to transform Tata Steel UK into a green, modern, future-ready business," Narendran added.
The proposal is also expected to boost steel security for the UK and push the industry towards decarbonization, reducing emissions by 50 million tonnes over the next ten years. “With a high degree of circularity, it would leverage strategic, domestically available scrap steel and promote local value addition within the UK," said Tata Steel's statement on Friday.
Tata Steel also added that the current steel-making plant at Port Talbot contains many 'heavy-end' assets, such as blast furnaces and coke ovens, which are reaching the end of their operational life.
The company also announced its plan to invest approximately £ 20 million over four years to set up two additional Centers of Innovation & Technology in the UK at the Henry Royce Institute at Manchester (for advanced materials research) and at Imperial College London (for research in Sustainable Design & Manufacturing).
“The proposed project would also involve Tata Steel’s balance sheet being restructured with the potential elimination of the current cash losses in the UK operations and non-cash impairment of legacy investments," Tata Steel added.
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