Chapman Tripp is delighted to have advised New Zealand Steel (NZ Steel) and BlueScope on the Government Investment in Decarbonising Industry (GIDI) partnership funding agreement between NZ Steel and the Energy Efficiency and Conservation Authority (EECA), to build an electric arc furnace at NZ Steel’s Glenbrook steel works, south of Auckland, for a total cost of around NZ$300 million.
The electric arc furnace will replace Glenbrook’s existing oxygen steelmaking furnace and two of the four coal fuelled kilns, reducing NZ Steel’s greenhouse gas emissions by more than 40% - equivalent to taking 300,000 cars off the road each year.
The project is subject to completion of a feasibility study to the satisfaction of the BlueScope Board and EECA, and receipt of relevant regulatory approvals. If approved, the project is expected to be operational by the end of 2026.
The Chapman Tripp team was led by finance partner Mark Reese and climate and environment partner Alana Lampitt. They were supported by solicitor Ben Methven and senior solicitors Andrea Curcio Lamas and Brendan Abley.
Mark said “This is a fantastic initiative for NZ Steel and New Zealand and represents a true step-change in the decarbonisation of New Zealand industry. The project demonstrates the benefits we can see when government and business work together to tackle decarbonisation.”
Alana noted “We are incredibly proud to be a part of the team making this important step in New Zealand’s industrial transition. The project will not only improve New Zealand’s economic resilience by increasing the security of supply of low-emissions domestic steel, but will also create circular economy benefits through the use of (currently exported) domestic scrap steel, while also providing an interruptible energy demand source to help improve resilience of New Zealand’s electricity system.”
Bell Gully and KPMG advised EECA and Buddle Findlay supported NZ Steel on other aspects of the project.