Rio Tinto Tomago aluminium smelter in NSW reportedly close to collapse

Rio Tinto’s massive Tomago aluminium smelter in NSW is reportedly close to collapse.

The facility, situated in Tomago about 13km west of Newcastle, employs some 1000 workers directly, but a stoppage would hit another 5000 indirect workers across the Hunter.

Mining giant Rio Tinto holds a 51.6 per cent interest in the smelter, which produces about 590,000 tonnes of aluminium each year, or about 37 per cent of Australia’s total production.

Multiple reports suggest the company is in emergency talks with state and federal governments for a bailout.

NewsWire has contacted Rio Tinto, NSW energy minister Penny Sharpe, federal energy minister Chris Bowen and the Australian Workers’ Union for confirmation of the discussions.

The AFR first reported on the talks on Friday, citing high energy costs for the possible shutdown.

Tomago is currently powered by AGL Energy’s Bayswater coal fired power station, but is pivoting to renewable energy.

2GB’s Ben Fordham, speaking on Tuesday, said the situation was “not good”.

“We’ve got the materials, we’ve got the workers, we’ve got the smelters, but what we don’t have is a working energy system,” he said.

“If it shuts, we’re not just losing a smelter, we’re risking 6000 jobs.”

Some 90 per cent of Tomago aluminium is exported to Asia.

Aluminium is a key material used in a range of industries, from aircraft bodies to drink cans.

More to come.