Smelter closure to cost 1000 jobs


Smelter closure to cost 1000 jobs

By Liam Mitchell

WOLLONGONG — Southern Copper Ltd (SCL) has announced that it will cease operations at its Wollongong smelter in January, laying off 400 workers from its own work force and possibly affecting the jobs of a further 600 workers in industries reliant on the smelter. Estimated losses to the area's economy are up to $100 million in the first year.

SCL, owned by mining and pollution giant CRA, is closing because it claims it cannot find the $120 million necessary for an environmental upgrade, to prevent pollution from the southern hemisphere's tallest chimney, as well as $110 million necessary for further expansion. CRA has refused to pay for the modifications, despite achieving record profits and having estimated reserves of $1.5 billion.

Southern Copper claims that due to "inability... to achieve international competitiveness through employee relations and cost structure reform", its financial viability is poor, incurring losses of $103 million in the three years to December 1993 and estimated losses of similar amounts in 1994-5. The company says that it loses 5 cents/lb on copper sold.

SCL announced the possible closure in October, saying that it was looking for a partner to help finance its operations and upgrades. At the time, the company and the union were involved in an industrial dispute over enterprise bargaining and job cuts, which resulted in a 25-day strike by workers.

Since the strike, the media and the company have sought to blame the closure on the union.

Prime Minister Paul Keating, in Wollongong on December 1, said that the government would provide immediate help from the CES for the 400 workers who are being made redundant.

Keating's gesture stopped short of help for other workers under threat of redundancies in smelter-dependent industries. Nor did he condemn CRA for refusing to help pay for the work to prevent environmental damage by one of its subsidiaries, after reaping so much in profits.

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