Soaring aluminium prices look likely to encourage Rio Tinto to press for extending its Tiwai Point sweetheart deal

As  the  price  of   aluminium breaks  new  records,  closing in   on  $US3000  a  tonne,  global  giant  Rio Tinto  must  be  having  a  quiet  chuckle  to  itself.

Only  a   year  ago it  was  threatening   to  close  the  Tiwai Point  aluminium  smelter,  consigning  it  to  the  scrap  heap  with  the  loss  of  700  jobs,  directly,  and  another 1600  indirectly.  For Southland’s  economy   it  would have  been  a  mortal   blow.

At  that  time, aluminium  was  fetching  only $1800  a  tonne.

Rio  Tinto   said   the  smelter  was  uneconomic  because the  price of  electricity  was  too  high.  In July   last  year it said  it would close    the  operation  because  of  high  costs and a challenging market.

The decision to close the smelter had disappointed politicians and local power firms as it came when the COVID-19 pandemic began to cripple the economy.

Some  economists  argued  NZ  should  let  it  go  and  divert  the  Manapouri  electricity, the  cheapest  in  the  country,   to  other  uses. Continue reading “Soaring aluminium prices look likely to encourage Rio Tinto to press for extending its Tiwai Point sweetheart deal”

Rio Tinto strikes a deal with the Ardern govt on cleaning up its mess – and it brings Ngai Tahu into an array of commitments

Should we really be cheering news of a giant global company picking up the tab for cleaning up its own mess?  Surely that’s what it should be doing.

But hey, we are talking about Rio Tinto, a company widely criticised by environmental groups around the world and at least one national government for the environmental impacts of its mining activities. Or so we are told by Wikipedia.

And it has been a dab hand at persuading governments in this country to help power its aluminium smelter operations near Bluff at a modest cost.

But the PM, helped by some of her ministerial team., has urged the company to do something about its toxic waste and – hurrah – the company  has obliged.

The company has made a raft of commitments, including recognising Ngai Tahu (at least by the looks of things) as an organisation akin to a co-governor.

In fact, in the press statement from the Beehive Ngai Tahu is listed ahead of the central and local government bodies involved in the agreement. Continue reading “Rio Tinto strikes a deal with the Ardern govt on cleaning up its mess – and it brings Ngai Tahu into an array of commitments”

Help is promised for Southland after Rio Tinto pulls plug but money more immediately will be pumped into West Coast rail

Latest from the Beehive –

Northland was missing from the regions to benefit from government announcements in the past 24 or so hours.  Southland, on the other hand, is being promised government support for its economy in the aftermath of Rio Tinto’s decision to close its operations at Tiwai Point.

Finance Minister Grant Robertson pledged:

“As we have done in Taranaki, we will support a just transition to more job opportunities. We know the strengths of Southland and we want to build on them in areas such as agriculture, aquaculture and manufacturing. There is also an opportunity to support other energy intensive projects like green hydrogen and data centres.”

But the only figure in the joint press statement with a dollar sign in front related to a sum of money the government expects Rio Tinoto to cough up.

Energy Minister Megan Woods said she wanted to make clear that

“ … the Government expects Rio Tinto to meet their obligations for clean-up of the site (an estimated $256 million) and do the right thing on the dross.” .

Good luck with that. Continue reading “Help is promised for Southland after Rio Tinto pulls plug but money more immediately will be pumped into West Coast rail”

The issue for the Govt – as the fate of Tiwai Point smelter is decided – is to work out where the national interest lies

The  Ardern  government  has a  real  headache, as  global  giant  Rio Tinto threatens to  close  one of the  country’s major manufacturing plants.

Rio Tinto has launched   what it calls  a  “strategic review”  of  the Tiwai Point aluminium smelter,  one of the two smelters  in the world producing ultrahigh-purity metal, and  the only one doing so from renewable energy.

It says  it  doesn’t  want  another handout from the government  (like the  $30m it got in 2012)  but  it urgently  needs action on transmission  costs from  Meridian’s Manapouri power station.

Some  of  the country’s  top  journalists have  been on the case.  The New Zealand  Herald  says  fear of  a shutdown has  worked before,  but it may  not  work this time.   Stuff  detects  a consensus emerging within Parliament that the smelter should close. Political commentator  Matthew Hooten  says “Let’s  say  no to Rio’s trantrum”.  He  argues  government  support  will just encourage it to ask for another  handout.

Others   contend  that because the  smelter  consumes  13%  of  the electricity generated  in NZ,  the  government  should welcome  the smelter’s closure because  it will mean cheaper  power for the  rest of us.  Who  cares, they say,  about the 1000  jobs  lost in Southland, the $600m  a  year  in export earnings, or the fact  NZ would have to start importing aluminium from  fossil-fueled smelters? Continue reading “The issue for the Govt – as the fate of Tiwai Point smelter is decided – is to work out where the national interest lies”