Business Report Economy

Tata Steel's R640m Richard's Bay smelter in the spotlight

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Durban - A draft environmental impact report for Tata Steel's proposed 240 000 tons per annum ferrochrome smelter in Richards Bay will come under scrutiny at a public meeting tonight, where opposition to the smelter is expected be aired.

One resident of the area said this was one of the most controversial projects in Richards Bay in years.

Concerns that were raised in stakeholder meetings were about air pollution, the location of the smelter within the Richards Bay industrial development zone (IDZ) and pressure on the area's infrastructure.

The Richards Bay Residents' Association was not available for comment yesterday.

Tata Steel identified a number of potential locations for the smelter, including Gladstone in Australia and Becancour in Canada. The decision to proceed with Richards Bay was based on the availability of electricity, water, infrastructure, port facilities and labour.

If given the go-ahead by provincial authorities, the first phase will be commissioned next year. The second phase will start in 2008 and the smelter will be at full capacity in 2009.

The R650 million smelter will create 120 direct permanent jobs once completed. During the construction of the smelter, about 1 800 temporary direct and indirect jobs will be created.

Cliff Bell, the marketing manager for the Richards Bay IDZ, said this would not be the first investment Tata had made in South Africa and, if the smelter went ahead, there could be further investments.

Tata Motors launched its range of vehicles in South Africa last year.

In 2001 Tata Infotech established an information technology joint venture, Consilience Technologies.

Bell said these investments created additional jobs and generated rates and taxes for the local municipality. After 2013, Tata Steel would contribute R70 million to the national tax base.

Tata had spent two years trying to get the smelter off the ground. Last year the focus was on environmental issues.

"The environmental impact assessment process is extremely slow and lends itself to protracted conflict between parties, with resolution being difficult," Bell said.

But residents of Richards Bay, who have had to deal with odours from Mondi and dangerous emissions from Foskor, are not keen on further heavy industry and are determined to keep those that are there in check.

According to the draft environmental impact report, there were no fatal flaws that could stop the development.

But there were areas that would need attention. The report, which was compiled by the Council for Scientific and Industrial Research and included specialist studies, said it was recommended that any mitigation measures be implemented through a comprehensive environmental management plan.

It should include a monitoring plan, and regular auditing and reporting.

Specialist studies covered air quality and a health risk assessment, water resources, materials handling and waste, biodiversity, noise, and macro and socioeconomic factors.

Once the public meetings have been held, the environmental report will be submitted to the provincial department of environmental affairs for a decision.