BlueScope (ASX:BSL) to get AU$55M funding from Aussie Government
March 15, 2022 02:53 PM AEDT
Highlights
The Australian federal government will invest around AU$55.4 million into BlueScope’s redevelopment project.
The federal government aims to safeguard steel supplies used by the Australian military and for renewable energy projects.
BlueScope will modernise its Port Kembla steelworks, spending AU$217 million.
The Australian federal government has announced to invest around AU$55.4 million into BlueScope Steel Limited’s (ASX:BSL) redevelopment project at Port Kembla.
BSL shares traded 0.21% higher at AU$19.10 at 12:19 PM AEDT today.
With this funding, the federal government intends to safeguard steel supplies used by the Australian military and for renewable energy projects.
The government is funding the project from Australia’s AU$1.3 billion manufacturing fund announced in 2020 to make Australia independent from Asia regarding critical goods.
The federal government further said that this funding would lower the need for overseas imports while securing Australia’s sovereign capability in steel fabrication.
BlueScope will spend AU$217 million to modernise its Port Kembla steelworks to produce plate steel. Plate steel is required by Australian armoured vehicles, patrol boats, wind turbine towers and large-scale solar installations.
The company will modernise its current mill and construct a new plate-rolling facility. This new facility will include enhanced plate processing and heavy roll forming facilities.
The company will also include a pipe mill, capable of producing circular, square and rectangular hollow steel sections to fabricate wind turbine towers in the facility.
Bottom line
This funding is expected to support hundreds of jobs and adjacent industries. Meanwhile, the redevelopment will also boost the local construction, as the Port Kembla steelworks has a proud history that will further help BlueScope secure more jobs in the region. Further, the AU$55.4 million investment is also a boost for BlueScope’s future business ventures.
BIS Price at posting:
$1.80 Sentiment: None Disclosure: Held
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