New power supply deal critical to the Hillside smelter’s survival
Multinational mining and metal company South32 needs to negotiate a new power supply deal with crisis-hit Eskom
The outcome of a renegotiated power supply contract with Eskom will determine whether its Hillside Aluminium smelter in Richards Bay remains a worthwhile business for global diversified metals and mining company South32. “While obviously we want Hillside to be successful, it’s been a good operation for a long period of time. What we need is a sustainable business, which means a good power contract,” said South32 CEO Graham Kerr on Thursday after the release of results for the six months to end-December. “Otherwise you’ve got to question whether it’s actually worth it in terms of generating a return.” The closure of the Hillside smelter would have an adverse effect on not just the Richards Bay economy but on SA in general as it would hurt the entire aluminium industry and cause more unemployment at a time when the country is reeling from job losses in the mining sector. The loss of a large power consumer like Hillside will also ultimately raise power tariffs for all users in SA, said...
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