Gladstone MP Glenn Butcher pins a white ribbon on Boyne Smelters General Manager Joe Rea at a community function.
Gladstone MP Glenn Butcher pins a white ribbon on Boyne Smelters General Manager Joe Rea at a community function. Helen Spelitis

'Refused': State MP says smelter had "ample” time to save jobs

JOB losses and production cuts at the Boyne Smelter could have been avoided, according to Gladstone's State member, Glenn Butcher.

At a press conference today Mr Butcher said BSL had been "rolling the dice" over the past two years not locking a contract for the price of their electricity.

He said the company was now facing the consequences of "sitting on the spot" price of electricity, which had jumped from $66 to $14,000mwh in just one week.

"(BSL) had been given ample opportunity for good pricing of electricity here in Queensland, and when they were competitive in the market and their prices for aluminium were high, they refused to take those offers," he said.

However, BSL general manager Joe Rea said that while the company met regularly with the generators in a bid to secure a competitive power contract, the contractual arrangements offered were several times the cost of generation.


"(The arrangements) were globally uncompetitive and (would have) locked BSL into uneconomical production," Mr Rea said

"It is simply not viable for BSL to accept the contracts.

"Our message to the generators would be to give us a fair go. Electricity prices in Queensland and the recent bidding practises of generators are putting BSL jobs at risk."

BSL today announced the company would face job and production cuts due to the power price hike.

Mr Butcher said this had been ongoing for two years.

"And while it is always a sad day when there are jobs potentially lost, the company had plenty of opportunities to maintain (its) sustainability.

"Unfortunately with the commodity price for aluminium right down and the electricity up, what we will see now is the margin between profit, and where (BSL) is sitting being affected by one cost - electricity.

"And what happens if these companies lower the prices, is that the State Government and the people of Queensland are then paying to look after the smelter, I'm sure the people of Queensland and Gladstone don't want to be paying to supply BSL."

Despite this, Mr Butcher commended the long-term Gladstone based business on its "extraordinary" and "award-winning" efforts to save on production costs.

"They are second-to-none for the way they streamline their business....," he said.

"...But this is the consequences."

At a press conference held at the Boyne Smelter at noon today, Mr Rea said the current situation was brought on with the new year.

"We have seen one of the Queensland generators holding 40% of their capacity to a price that is up to 500 times the cost of generation, which effectively withholds electrical generation capacity in the market," he said.

BSL's operations employ about 1000 people and indirectly supports about 6700 jobs nationally, with 3000 of these jobs in the Gladstone region.

The smelter contributes more than $1.4billion annually to Australia's Gross Domestic Product, with more than half of this economic benefit going to the Gladstone region.

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