Tata Steel signs a £500 million grant funding agreement with UK Government for £1.25 billion green steel project in Port Talbot

The company stated that the agreement will allow it to proceed at pace with the project to install an electric arc furnace at Port Talbot for steelworks in Wales. Tata Steel stated that the project will bolster the UK’s steel production along with preserving 5,000 jobs. The £1.25 billion project marks the largest investment in the UK steel industry in decades.

The new assets will aid in reducing the UK’s total industrial carbon emissions by 8% with Port Talbot seeing a 90% reduction in emissions. The reduction in emissions will be achieved by utilizing scrap.

In addition to £750 million investment by Tata Steel, the company will also leverage its engineering and project capabilities for the project. The company reported that the basic engineering is complete and equipment orders will be placed shortly for the electric arc furnace (EAF) and ladle metallurgy furnaces, a new coil box, and crop shear for the hot strip mill. Further, a cranes package for construction management and civil engineering will also be procured.

The project will also provide employees that are leaving with support packages along with a re-training scheme for employees that are at-risk of compulsory redundancy.

T V Narendra, chief executive officer and managing director of Tata Steel, said that the government’s support will help the company transform Port Talbot. The company will continue working with the Transition Board and the UK and Welsh governments to boost the economy and job creation in South Wales.

“With the UK government’s critical support, this complex and ambitious transformation of Port Talbot has the potential to make the plant one of Europe’s premier centres for green steelmaking,” he said.

Shares of the company have risen by nearly 7% since the beginning of the year. The stock has gained over 15% in the past year.