The future of Portland’s aluminium smelter is up in the air after its discounted power agreement with the State Electricity Commission of Victoria expired on Monday.
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A 20-year contract negotiated with power company AGL kicked in on Tuesday. But it will expire in August next year after Alcoa, which owns 45 per cent of the smelter, terminated the contract in August this year.
An Alcoa spokesman said it was financially difficult for the smelter, which directly employs more than 500 staff, to operate under the new contract.
“It does increase our costs and because we also have the transmission costs now on top of that as well, both of those things increase our operating costs which makes it harder for the smelter to be competitive,” he said.
The spokesman said the company was not yet looking at closing the smelter.
“What we’re talking about is obviously we want to keep the smelter running,” he said.
“We think it’s a good facility and we’re trying to resolve this. What we’re doing now is we’re continuing our discussions over power and agreements and also with government.”
Minister for Industry and Employment Wade Noonan confirmed the government’s involvement.
“The Portland smelter is a significant employer in the region and the government is working closely with Alcoa to secure the long-term future of the Portland smelter,” Mr Noonan said.
South West Coast MP Roma Britnell called on the state government to step in to save the jobs.
