Aluminium production at BHP Billiton’s Bayside smelter in Richards Bay is expected to come to an end in the next few months, according to local newspaper reports. The sad but inevitable news was communicated to employees and stakeholders at a briefing at the Hillside smelter recently.
With the company being ‘in the red’ for the past 18 months, the announcement came as no surprise but was still met with shock, concern, tears and anxiety by the majority of staff.
Addressing stakeholders, Asset President at BHP Billiton Aluminium SA Lucas Msimanga said the decision was essential to ensure the future sustainability of the Hillside smelter instead of continuing to run a struggling ‘end of life’ business.
In September 2012, BHP Billiton announced the review of its Bayside aluminium facility in Richards Bay as the operation had been under significant and ongoing financial pressure. As part of that process, BHP Billiton began a formal consultative process with employees on a proposal to cease smelting activities and associated services at Bayside.
“Our aim is to minimise the impact of any changes on employees and the local downstream industry,” said a company statement. “BHP Billiton has been in ongoing discussions with its stakeholders to discuss the challenges faced by the business, explore options for the Bayside operation and ensure a sustainable aluminium business can operate in Richards Bay.”
To support the ongoing supply to the local customers, the cast house within the Bayside operation will continue to operate with supply from the neighbouring Hillside smelter while further options are assessed for its future. Decommissioning and rehabilitation of the remainder of the Bayside site, if undertaken, would provide an additional source of employment for the duration of the project.
“As we work through the consultation process, the health, safety and wellbeing of our people will remain a priority,” said BHP Billiton South Africa Vice President Communications and Stakeholder Relations, Lulu Letlape.
“We are focused on mitigating the impact of potential job losses while ensuring the existence of a sustainable aluminium business in Richard’s Bay.”
The decision to stop aluminium production at Bayside will in turn release approximately 160 megawatts of power back to Eskom’s electricity grid at no compensation to the company. Bayside, which employs approximately 500 employees, is the only producer of value-added primary aluminium products in Southern Africa that is used for the local market.