Power-supply deal critical to Hulamin’s continued viabilty
Aluminium semi-fabricator and exporter Hulamin says it will be robbed of its only supply of the metal if global resources group South32 cannot secure a good power-supply deal for its Hillside smelter from Eskom. “We owe our existence to the fact that we buy aluminium from the Hillside smelter. If Hillside were to close, that would mean hardship for Hulamin and its employees. We need a domestic supply of aluminium,” Hulamin CEO Richard Jacob said on Tuesday. According to South32, there was a disagreement between the company and Eskom over the expiry date of its supply contract. The parties have agreed to negotiate a new power deal. Historically the contract has been favourable to South32 and has largely insulated it from price hikes.
South32 CEO Graham Kerr said in February the conclusion of the contract with Eskom was crucial to the miner’s future. He said at the time the smelter, which is entirely owned by South32, needed a good power contract to be sustainable.