600 smelter jobs at risk

The jobs of a further 600 aluminium smelter workers at Hydro’s Kurri Kurri aluminium smelter could be at risk, Hunter MP Joel Fitzgibbon has warned.

Mr Fitzgibbon and his state Labor counterpart, Cessnock MP Clayton Barr, met with executives of the Norwegian-owned company on Thursday, a day after the company announced that 150 workers were to lose their jobs.

Hydro’s senior vice-president, Olaf Wigstol, said on Wednesday the tumbling price of aluminium and the strength of the Australian dollar had prompted action as the plant was losing money.

But the closure of one potline – a one-third cut in production – might not be enough to save the Kurri Kurri operation.

Mr Fitzgibbon told the Mercury on Thursday that unless there was a change in market conditions, the plant’s estimated 600 employees were at risk of unemployment.

“We had some sense for a period of time that this was coming,” he said. “But, alarmingly, this may only be stage one.

“Because world aluminium prices remain very low, and the Australian dollar remains very high, the viability of the entire plant is under a cloud.

“The company gave us a very frank overview of the plant’s business position and made it quite clear that unless we see a change in the price of aluminium, [the plant’s viability is in question].

“These are not matters under our control and, on that basis, I am concerned. The closure of the plant would affect up to 600 jobs directly and a number more indirectly - that would be dramatic.”

But Mr Fitzgibbon said the state government could provide some security with an electricity supply contract for the smelter from 2017.

A break down in negotiations with the former Labor state government before the March 2010 election prompted industrial action and fears the company could take the operation offshore.

He said the carbon tax had not been raised as a factor affecting the viability of the smelter.

Liberal MP Bob Baldwin was quick to point to the tax as a further impediment to the region’s aluminium industry on Wednesday, when both Hydro and Tomago Aluminium announced a combined 250 job losses.

“Bob Baldwin’s attack on the carbon tax is seeking to make political capital from the job losses of many,” Mr Fitzgibbon said. “In all my discussions with the company, and with experts in the industry, the carbon tax was not mentioned.”