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Tiwai Point future enters another uncertain phase

Feb 09, 2022

Rio Tinto has sent a positive message to its workers and the region of Southland by signalling it hopes to remain at Tiwai Point beyond 2024, the Southland Chamber of Commerce says.

Tiwai Point aluminium smelter. Photo: Graham Dainty 2012

The murky future of the Tiwai Point aluminium smelter got murkier yesterday as the smelter's majority owner Rio Tinto issued a statement saying it believed there was a pathway to keep the operation running beyond 2024.

In 2020, the mining giant threatened to close Tiwai Point over electricity costs.

It has also been under pressure to secure and clean up toxic waste stored at the site, and locals have called on the company to reveal its long-term plans to deal with the problem.

After securing a cut-price power deal Rio Tinto agreed to keep the site open for four more years.

The company's statement came amid historically high aluminium prices.

Southland Chamber of Commerce president Neil McAra said it was good news for the region and the smelter's workers.

"This is positive news, but there's lots to continue on with for the development of Southland. I don't think we can control what that long-term future looks like.

"NZAS [New Zealand Aluminium Smelters], Meridian and others will continue with the commercial arrangements, but for Southland we want a long-term and prosperous economy, which hopefully includes Tiwai and other new industries as well."

Minister of Energy and Resources Megan Woods said her vision for the future of Southland had not changed.

Last week the government announced a Just Transition work plan for the region.

"Developing new industries, creating new jobs, improving the community's ability to manage economic shocks, setting Southland up for the future - these give Southlanders options that are not dependent on one large employer," Woods said when the plan was announced.

Woods told RNZ the future of the Tiwai Point smelter was a commercial decision for Rio Tinto.

"While they've announced they are rethinking their decision I note Meridian stated today to the NZX it is not in discussions with NZAS, around future electricity contracts.

"I also note that the general 'will they, or won't they' uncertainty surrounding the smelter goes back across multiple governments and just creates frustration for the people of Southland, who rightly deserve to know what's going on once and for all," she said.

"Whatever the outcome, this government has been clear and consistent that there will be no taxpayer subsidies paid to the multi-national.

"What I can also tell you is that my vision for the region has not changed, I remain focused on creating a more resilient local economy, developing new industries, and improving the community's ability to manage change themselves, regardless of the decisions of any one firm.

The Southland Just Transition Work Plan "is a big step forward in providing certainty for Southland's economic future", Woods said.

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