£35 Million And Stopping 827 Jobs: Independent Report Reveals Cost Of Keeping Redcar Blast Furnace

Tees Valley Mayor | Published on: 23rd October 2020

  • Report finds cost of keeping Redcar Blast Furnace would be £35.4million over 10 years and would damage investment in other parts of Teesworks site
  • Developing 20-acre Blast Furnace site would create 827 jobs and add £161million to Tees Valley economy.
  • ‘Extremely dangerous’ structure posing a risk to trained inspectors and will ‘only worsen with time’

The cost of keeping the Redcar Blast Furnace will be in excess of £35million, stopping the creation of 827 jobs and damaging future investment across the Teesworks site, a report and accompanying economic analysis has found.

An independent report into the possible retention of the Blast Furnace as a visitor attraction and official figures from the Tees Valley Combined Authority prepared for the Teesworks Heritage Taskforce found it would cost £35.2million over a ten-year period to preserve the ‘extremely dangerous’ structure.

The report was prepared by Primetals the company which originally built the blast furnace. This is based on fixed costs of £25.4million and annual running costs of £982,000 to keep the structure safe.

The business case for the regeneration of the Teesworks site, as submitted to Government, shows the Blast Furnace site of 20 acres has the potential to sustain 516 direct jobs and as many as 827 when indirect effects and the supply chain are also taken into account.

This is in contrast to the assumption of six jobs being created at a visitor centre, according to the Redcar Blast Furnace Visitors Centre Suitability Study.

Further analysis from the business case shows that the 20-acre blast furnace site, if developed, would add £161.4million to the Tees Valley economy over the next 10 years.

The independent report also found the Blast Furnace was in an ‘extremely dangerous condition’ that was ‘wholly unsuitable for safe public access’. Its current condition poses a risk for trained structural inspectors and is proving even more challenging for them to monitor its defects, which will only worsen with time, according to the report.

Economic analysis from TVCA also found money spent on retaining the Blast Furnace and associated heritage support will not deliver sufficient financial return to allow investment in other parts of the Teesworks site and job creation, with the loss of up to £100million.

Primetals, a world leader in the construction of blast furnaces, was tasked with carrying out the report to provide an independent appraisal into the possibility of retaining the Redcar Blast Furnace as a visitor attraction.

In response to the findings, Tees Valley Mayor Ben Houchen said: “This independent report which has been produced for the Teesworks Heritage Taskforce confirms what I have always feared – keeping the Blast Furnace would result in astronomical costs, and most importantly, would harm our plans to create local jobs for local people on the site. A development that will cost jobs on this site is the last thing the communities across Redcar want, especially at this time as we deal with the coronavirus pandemic.

“The findings clearly reveal the exact costs and challenges we face in keeping this extremely dangerous structure which is cordoned off to stop injuries occurring due to its unsafe conditions which will only further deteriorate with time.

“As an elected Mayor, I will always strive to do what the people I represent want me to do. The overwhelming majority of feedback I have had from former steelworkers to people living in Redcar is they want us to look to the future and move on. They understand the complexities and potential of the site and want us to bring in investment and create thousands of jobs on the site for the people of Teesside, Darlington and Hartlepool.

“We now know from this report, and from what we’ve been told by Net Zero Teesside, that keeping the blast furnace and turning the area into a tourist attraction would prevent that from happening. I absolutely agree that we should find ways to recognise and celebrate our heritage, but an approach that would cost 827 jobs and hundreds of millions of pounds of investment is not the answer.

“I am pleased the Taskforce has received this report today and will ultimately take it on board in their findings. I’m also pleased the people of Teesside, Darlington and Hartlepool can now see for themselves the scale of the challenges and costs involved with the Blast Furnace, but by making the right decisions now in the long term interests of everyone, we can make it a site people can be proud of again.”

Read the full report here.

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