The Australian Government, in partnership with the New South Wales (NSW) Government and Tomago Aluminium, has announced a plan to secure the future of Tomago Aluminium’s smelter beyond 2028.
This initiative aims to safeguard several jobs in the Hunter region and strengthen Australia’s aluminium production using renewable energy.
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Established in 1983, Tomago Aluminium’s smelter manufactures up to 590,000 tonnes (tpa) of aluminium, accounting for nearly 40% of Australia’s total aluminium output.
The smelter operates as an independent joint venture (JV) owned by Rio Tinto (51.55%), Gove Aluminium Finance (36.05%) and Norsk Hydro (12.40%).
As Australia’s largest aluminium smelter, Tomago Aluminium is currently facing energy supply issues, with its existing electricity contract due to end in 2028.
The new partnership aims to provide reliable, competitively priced energy for the smelter, enabling its ongoing operations and bolstering regional economic stability.
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By GlobalDataTomago Aluminium CEO Jerome Dozol said: “We are grateful to both the Federal and NSW governments for their commitment and partnership in working to address our energy challenges. Today’s development represents a significant milestone in our ongoing engagement with many stakeholders working towards this shared goal.
“It reflects our collective recognition of the importance of maintaining local manufacturing capability in Australia. We look forward to working collaboratively with government on this next phase.”
In the months ahead, Tomago Aluminium will collaborate with both levels of government to secure a long-term, fixed-price power purchasing agreement (PPA).
The partnership will also feature concessional financing to fast-track the rollout of renewable energy generation and storage in NSW.
Tomago Aluminium plans to invest at least A$1bn ($665.66m) in capital projects and major maintenance over the next ten years.
This investment will also target additional decarbonisation opportunities for the smelter.
The initiative follows a period during which 24 of Australia’s 28 coal-fired power stations announced closures, creating uncertainty for the regional industries.
Australia Prime Minister Anthony Albanese said: “We want to ensure that Tomago continues to forge Australia’s prosperity, and it continues to create and sustain good, skilled jobs. I want to thank the workers and the Hunter community who have faced uncertainty in recent weeks.
“My government is working together with the NSW State Government and Tomago Aluminium on a new energy agreement that will secure the future of the facility. Tomago has a proud place in Australia’s history – and we will ensure it has a central place in Australia’s future.”
