More than 1400 Nyrstar jobs in Port Pirie and Hobart at risk as no new deal reached by May 1 deadline

The livelihoods of more than 1400 workers at two Nyrstar smelters in South Australia and Tasmania are at risk after no new bailout package was worked out on the final day of deadline - with China blamed for threatening their viability.

The Federal Government and the two States in August last year announced a $135 million package to keep workers employed at the two smelters.

But with the May 1 close-of-business deadline expiring, 900 jobs in Port Pirie and another 500 in Hobart are in jeopardy.

This is despite the critical mineral smelters being considered vital for renewable energy projects and “national sovereignty”, with their potential loss being likened to the closure of oil refineries in Australia during the 2010s and early 2020s.

South Australian Labor Premier Peter Malinauskas said no new deal had been reached despite weeks of negotiations with Dutch-headquarter Nyrstar and its Singaporean parent company Trafigura.

“As it stands right now, those negotiations are ongoing and we have not yet reached a final resolution with Nyrstar,” he told reporters late on Friday afternoon.

“It would have been far better if we had been able to resolve these negotiations in advance of the first of May deadline - that is a source of concern, it’s impossible to deny it.

“There is a legitimate, national sovereignty challenge here.”

China has been blamed for threatening the viability of the 130-year-old Port Pirie smelter, which employs 800 people and 250 contractors to process silver, zinc, copper and by-products like sulphuric acid, needed for renewable energy.

“The smelter was making money and what we have started to see is through geostrategic plays, frankly, very significant industrial activity on behalf of China to deliberately drive down the smelting price globally,” Mr Malinauskas said.

“There has been a very deliberate play, particularly by China, to reduce it, that has the effect of making smelting operations around the rest of the world uneconomic which is why they’re closing hand over fist globally.

“The problem for Australia is that if we lose our smelting operations, we lose our ability to produce critical minerals and metals, which we know the rest of the world needs, particularly liked-minded nations.”

The SA Premier likened the future of the smelter to the closure of five oil refineries between 2012 and 2021.

“Fifteen, 20 years ago, the nation set itself down a path where we’d lose our fuel refining capacity - we cannot make that same mistake with the nation’s smelting capacity, which is why Port Pirie has to remain an ongoing operation,” he said.

Last year’s Federal-State $135 million rescue package included $57.5 million from the Commonwealth, plus another $55 million from South Australia and $22.5 million from Tasmania’s Liberal government led by Jeremy Rockliff.

“I’m hopeful that by close of business today, we’ll see a renewed position from the three governments that are contributing to this effort for Nyrstar’s consideration over coming days and weeks ahead,” Mr Malinauskas said.

“Quite obviously, one of those key points of difference is the level of funding and that is what we’re working through with Nyrstar.

“Governments will always have a responsibility to protect the taxpayers’ interest and that’s one that we treat seriously.”

All three governments remained committed to keeping a viable smelting industry, a spokesman for Federal Industry Minister Tim Ayres said.

“Nyrstar’s Port Pirie and Hobart facilities are strategically important assets that fulfil a key role in Australia’s critical minerals future,” he told AAP.

Nyrstar Port Pirie general manager Darrin Cooper said important upgrades and production of the nation’s first antimony metal had been delivered since the August funding agreement.

“Disappointingly, despite this progress ... we have not been able to reach agreement on the next phase and now have to consider all options for the business,” he said.

The August funding was to fund continuing operations, a rebuild of the smelters and feasibility studies into critical metals production.

South Australia’s other major regional employer, the Whyalla steelworks, last year went into administration with the State Government passing emergency legislation to override controversial British billionaire Sanjeev Gupta.