According to a report by Sky News, officials in the UK government are urging the nation’s treasury to provide about $360 million in funding to British Steel so the company can keep its furnaces in northern England operating.
British Steel, which is owned by the China-based Jingye Group, has reportedly been requesting government funding since COVID-19 restrictions caused a ‘severe disruption in steel demand’ in 2020.
The report states that two UK ministers, Grant Shapps and Michael Gove, have been urging UK chancellor Jeremy Hunt to approve the decision to provide funding to the steelmaker.
According to the media outlet, ‘the demise of British Steel could cost the government up to $1.2 billion in decommissioning and other liabilities.’
The letter to Hunt also cites the need to maintain domestic steel production in the UK and mentions British Steel’s desire to invest in decarbonization efforts.
Jingye and British Steel have announced the possibility of two blast furnaces in Scunthorpe being idled as a cost-cutting measure in the next few weeks, which has put further pressure on Hunt to make a swift decision on the demands.
Source: Sky News