The Australian and New South Wales (NSW) Governments are set to jointly provide A$2.5bn ($1.76bn) to support the continued operation of the Tomago Aluminium smelter, securing more than 1,000 direct jobs and thousands of indirect roles in the Hunter region.
The funding aims to deliver a long-term renewable energy solution for the facility, ensuring commercially viable operations past 2028 and facilitating the decarbonisation of over 10% of NSW’s electricity grid.
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Under the agreement, Tomago Aluminium will enter a 10-year power purchase arrangement starting after the current contract ends on 31 December 2028.
From 2033, the smelter is expected to source all its electricity from renewable generation.
The NSW Government’s support is capped at A$1.22bn over a decade beginning in 2029.
Tomago Aluminium has committed to investing at least A$1.1bn at the facility, including A$100m towards decarbonisation initiatives and a demand-response programme designed to help manage the state’s electricity system.
The government’s investment package is intended to support the smelter’s operations beyond the expiry of its existing electricity contract and encourage advancement in clean energy and advanced manufacturing sectors.
The funding is also expected to support the development of up to 3GW of new renewable electricity generation and firming capacity for the state.
Tomago Aluminium is owned by a joint venture comprising Rio Tinto (51.55%), Gove Aluminium Finance (36.05%), and Norsk Hydro (12.4%).
Rio Tinto Aluminium and Lithium chief executive Jérôme Pécresse said: “This agreement secures Tomago Aluminium’s long-term future, supporting Australian manufacturing, skilled jobs and the Hunter community, as well as providing security of supply to the smelter’s global customers.
“It demonstrates what can be achieved when industry, governments and workers come together to strengthen Australia’s manufacturing sector.”
The smelter, located roughly 13km west of Newcastle, produces up to 590,000 tonnes of aluminium annually, representing nearly 40% of the country’s output.
Tomago Aluminium directly employs about 1,000 people, with around 200 contractors, and is estimated to support 5,000 indirect jobs in the region.
This agreement follows a separate deal in March 2026 concerning the Boyne aluminium smelter at Gladstone.
