Tata Steel has proposed a rescue deal to UK steel workers' unions that if accepted by workers would help investments in the its troubled Port Talbot plant, in South Wales, the country's largest, which employs around 4,000 workers.
Workers at the Tata-owned plant are to discuss the plan during the week, which if agreed, could see investment in the sprawling steel plant in return for concessions on terms of retaining staff.
A deal would help retain Port Talbot's two blast furnaces, which turn iron ore and coke into molten iron. One of the blast furnaces is due to stop production in 2018 but unions have been fighting to keep it running.
If an agreement is reached with the workers, Tata Steel will look into partial relining of the blast furnace as an upgrade that would extend its life until at least 2020, a media report said today.
Port Talbot is located in Neath Port Talbot, in West Glamorgan. The town is built along the eastern rim of Swansea Bay in a narrow strip of coastal plain surrounding the River Afan estuary
Swansea is visible on the opposite side of Swansea Bay. A significant regeneration programme is underway in Port Talbot, bringing a new look and new life to the town centre and docks, which includes new homes, offices, light industry, retail developments and improvements to the railway station.
Tata Steel has been in discussions with German Steelmaker ThyssenKrupp for a merger of its European operations, which, according to news agency Reuters, threatened to block investments in new blast furnace at Port Talbot (See: Deal with Tata Steel still on cards, says Thyssenkrupp). ThyssenKrupp is confronted by over capacity in Germany, Holland and the UK.
Tata Steel has been in talks with union leaders over the existing over its contributions to the British Steel Pension, which has 130,000 members. The pension scheme has been a drag on the company's revenues.
A deal would unlock the investment required to refurbish the No 5 blast furnace - ensuring a two blast furnace operation for at least the next seven years.
Taylor said, "It's good news that Tata are committing to a lengthy stay. Once you reline the furnace, which I assume will be furnace number five, it gives you at least an extra 15 to 20 years."
A statement from Tata said: "We are seeking a positive future for the UK business and during discussions with the trade unions we made substantial assurances to achieve this."
The Welsh government is still committed to providing Tata with a £60m funding package, providing it commits to maintaining current primary steelmaking capacity over the long-term.
The UK Steel Workers Union wants to secure the long term future of the steel works and the security of the workforce.
''The unions and Tata will want this to be decided before their extraordinary general meeting which will take place in Mumbai on December 21.''