Covid-19

Tiwai Point smelter exempted from lockdown

The Tiwai Point aluminium smelter is one of a handful of industrial businesses exempted from the nationwide Covid-19 lockdown, Marc Daalder reports

The Tiwai Point aluminium smelter, which has been running continuously since it launched in 1971, will continue to produce the valuable light metals even as the rest of the country shuts down for at least four weeks.

Confusion over what services would be considered essential and permitted to remain open during the lockdown period led to a clarifying press release from the National Crisis Management Centre last night.

The NCMC guidelines indicated that dairies would remain open, most liquor stores would close and the Warehouse would not receive the exemption it had claimed to have earlier in the day on Tuesday.

Industrial businesses received special focus: alongside Tiwai's exemption, the methanol production company Methanex was permitted to continue operating, while NZ Steel and pulp and paper plants were asked to shut down in a way that would make it easy to restart after the lockdown lifts.

Aluminium smelters are notoriously difficult to close and reopen. Shutting down the Tiwai Point smelter could take a week or more. Reopening could take months and cost millions of dollars.

When Tiwai Point reopened its fourth potline in 2018, it put $6 million into upgrading and restarting the line. The process took around six months.

The decision to keep the smelter running came just a week before the deadline for Tiwai's owners, multinational mining company Rio Tinto, to announce the results of a strategic review of the plant. If the review concludes with a decision to close the plant, more than a thousand people could lose their jobs.

It is unclear how or whether Covid-19 could affect the deadline or decision. A mandatory lockdown in Quebec, where Rio Tinto operates several smelters, has forced the company to scale down its operations there until mid-April. Although smelters were eventually exempted from the Quebec lockdown, the company has to operate them with the smallest number of staff possible.

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