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Tata Steel is poised to confirm up to 3,000 jobs could be lost at its factory in Wales as part of a restructuring of its UK operations.
The board of the India-based group met on Wednesday and will confirm the details later, according to several people familiar with the situation.
The company, whose Port Talbot site is the biggest single emitter of carbon dioxide in the UK, is under pressure to move to greener, less carbon-intensive forms of steelmaking.
The government has offered £500mn of taxpayer support as part of an agreement struck in September to help with the transition.
Ministers remain in talks with Britain’s second-largest steelmaker, Chinese-owned British Steel, which operates two blast furnaces at its site in Scunthorpe, over a separate funding package.
Unions fear up to 2,000 jobs are at risk at British Steel.
Tata Steel will invest £750mn in its UK operations as part of the deal with the government.
Its executives said in September that UK operations were losing more than £1mn a day. The company wants to close its two remaining blast furnaces as quickly as possible and build a less carbon-intensive electric arc furnace.
The two furnaces use electricity to melt recycled or scrap steel but are also less labour intensive. More than 2,800 jobs are at risk if Tata closes both furnaces, as well as their associated facilities such as the coke ovens.
Unions have said they want the company to restructure more gradually.
One option could be to build two smaller electric arc furnaces instead and close the blast furnaces once the others are in place, said one person familiar with the discussions.
Trade unions condemned the expected proposals.
Roy Rickhuss, general secretary of the Community steel union, said it would “never accept Tata and the government’s plan to close down our iron and steelmaking facilities and supply our mills with foreign steel for however many years it takes to build an electric arc furnace”.
“Closing down our industry to import dirty steels from abroad, giving our jobs and our order book to competitors overseas, is not a green plan and we will oppose it with everything we’ve got,” he added.
A government aide said the agreement reached with Tata “secures the long-term future of steel in South Wales”. Without significant government support, “there was a risk of closing Port Talbot altogether”.
“All 8,000 Tata employees could have lost their jobs and an additional 12,500 in the supply chain,” said the aide.
One of the two blast furnaces was nearing the end of its safe operational life and the other was in its final years, added the aide.
Tata Steel declined to comment on the impending announcement but said it hoped to “start formal consultation with our employee representatives shortly”.