Landmark agreement secures future for Port Pirie



The Commonwealth and South Australian Governments have reached an historic in-principle agreement with Nyrstar to transform its smelter and secure the long-term future of Port Pirie and the jobs of more than 2500 people who rely on it for their livelihoods.

The agreement comes after months of negotiations and supports the transformation of Port Pirie through the construction of a $350 million advanced poly-metallic processing and recovery facility.

As well as providing long term security for the Nyrstar workers, the transformation will mean that lead emissions will be substantially reduced.

Premier Jay Weatherill said the agreement delivers security to thousands of families and stability to the Spencer Gulf region.

"Local member Geoff Brock has consistently told me that Port Pire would not survive without the smelter," Mr Weatherill said.

"But this agreement will now see Nyrstar undertake a feasibility study to transform the environmentally outdated 120-year-old smelter into a new, cleaner metal processing and recovery centre.

"For the first time in a long time the residents and families of Port Pirie and the surrounding areas can have confidence in their future.

"The transformation will deliver the most significant reduction in lead emissions ever achieved in the life of this smelter."

Under the agreement:

  • Nyrstar will contribute $100 million from its own balance sheet toward the transformation and a further $100 million will be funded by the forward sale of some of the incremental metal units to be produced at Port Pirie as a consequence of the transformation
  • A structured equity instrument will facilitate third-party investment of $150 million, with the Commonwealth, through the Export Finance and Insurance Corporation, providing contingent support through a guarantee
  • The State Government will provide contingent support for the investment in relation to Environmental, Health and Safety liabilities and regulatory certainty via legislation that will prevent key terms of Nyrstar's licence with respect to lead emissions being amended without Ministerial consent.

Mr Weatherill said the need to achieve higher environmental and health standards for the people of Port Pirie was the centrepiece of the government's negotiations with Nyrstar.

In parallel with the smelter upgrade, a new Targeted Lead Abatement Program will be developed for Port Pirie. The aim of the program will be to significantly reduce lead contamination levels by re-scoping the existing community lead reduction program.

"The State Government is contributing $5m to begin the immediate clean up of environmental issues, mainly the lead dust that is emitted from the current smelter," Mr Weatherill said.

"Nyrstar is also contributing $3m per year for up to 10 years to implement the Abatement Program which will aim to achieve better health and environmental outcomes and continue to lower blood/lead levels for families and children."

Nyrstar Chief Executive Officer Roland Junck said the transformation will provide a long term sustainable future for the Port Pirie operation, its employees and the local community.

"Without the support of the Commonwealth and South Australian Governments, the transformation would not be possible," Mr Junck said.

"What has been achieved here working together with government is exceptional, and is a model of which many other countries could take note."

Member for Frome, Geoff Brock said residents can now look forward to the future with some security.

"For a long time residents of Port Pirie have had to deal with the stigma of lead pollution, we can now see that as a thing of the past," Mr Brock said.

"As former Mayor and now as the Local MP I have longed for this day - it is a great day for Port Pirie.

"I have been speaking to the Premier and Minister Koutsantonis for a long time now about this and it is great we have finally come to a successful resolution."

Minister for Manufacturing and Innovation and Trade, Tom Koutsantonis said successive governments have tried and failed to grapple the issue of providing job security and healthy outcomes for the people of Port Pirie.

"This Government has finally coming up with a solution that will guarantee Port Pirie's future and allow workers at Nyrstar to enjoy their Christmas without being anxious about their future job security," Mr Koutsantonis said.

"This town has been through so much but at last we will be able to provide them with a path to better health, a path to a cleaner environment and a path to a job that is free of anxiety."

The final investment is subject to the investment case including detailed engineering studies due to be completed next year, however initial investigations by the company and the Port Pirie Transformation steering committee have proved up the viability of the project.