Steelworks still idle as coal baron bidder reveals richest family ties
A Brisbane coal trading billionaire and Ferrari enthusiast has exclusively revealed details of his Whyalla Steelworks bidding partnership with one of Indonesia’s richest families.
A Singapore-based company that is owned by one of Indonesia’s richest families can be revealed by InDaily as a key Whyalla Steelworks bidding partner alongside Australian billionaire Matt Latimore.
As the steelworks’ blast furnace enters its fifth month of being offline, Latimore – one of the nation’s richest men who is behind metallurgical coal trading giant M Resources – said his bid for the Whyalla Steelworks was supported by Golden Energy and Resources (GEAR).
The bid also involves technical support from Hazer Group, which is in the process of developing new technology that turns natural gas into low-emissions hydrogen and solid graphite, without generating carbon dioxide in the process.
As the September deadline for an announcement of who will win the bid to buy Whyalla Steelworks looms, a spokesperson for administrators KordaMentha – which has controlled the operations since February last year – confirmed there had been no activity at the steelworks for four months as work to get the struggling blast furnace operating was “taking longer than first anticipated”.
“Since the blast furnace went offline in April, our teams have been working hard to safely return it to normal operating temperature,” the spokesperson said.
M Resources is one of two companies shortlisted by the administrators of the Whyalla Steelworks to purchase the ageing steel plant, the only one of its kind in Australia that can produce long steel products for rail and construction purposes.
Latimore is in stiff competition with one of the world’s most prominent – and experienced – steelmaking companies: Jindal Steel International.
And there is the ever-present BlueScope Steel, which retains first right of refusal to any offer put forward for the steelworks, keeping them firmly in the game.
Unlike his two competitors, Latimore has no experience in making steel but he believed his Australian citizenship gave M Resources an edge.
“M Resources is an Australian company, paying Australian wages and supporting Australian working conditions,” he said.
“We have felt very welcomed and supported by locals in Whyalla and we look forward to building those relationships. Our track record is about working with communities for the benefit of all and that has been our approach in other regional communities like Wollongong.
“Whyalla has been through far too much and they deserve a trustworthy, long-term partner for the future. We believe we are the right partner. We know how to run strong and successful businesses in Australia, under Australian conditions.”
M Resources was founded in 2011 by Latimore – a former Wesfarmers executive – who has become one of the nation’s most prominent coal barons.
He found success in marketing and trading metallurgical coal – a key component in steelmaking – and his business currently spans mines, logistics and other assets.
The company currently has more than $3 billion in assets under management, and trades more than 25 million tonnes of coal every year, delivering the company $2 billion in annual revenue.
Latimore himself is a prominent businessman and a Ferrari collector. The baron has one million followers on Instagram where he posts photos of his collection of Italian sportscars.
So while M Resources currently does not make steel itself, it is a key player in the global creation of the product.
It has mines too. Together as ‘GM3’, M Resources and GEAR operate the Appin Mine in the Wollondilly region of New South Wales – 25km north of Wollongong – and the Dendrobium Mine near Mount Kembla.
The joint venture in June announced it had entered into an agreement to acquire the coal business and assets of Tahmoor Coal and Bargo Collieries from liquidators.
Latimore told InDaily that any deal for the Whyalla Steelworks alongside GEAR would keep M Resources as the “controlling and majority owner”.
“We want to bring Whyalla back to Australian ownership and control,” Latimore said.
While his plan for the Steelworks was less detailed than the one presented to InDaily by Jindal Steel International – which hopes to emulate its Oman steelmaking facility in the South Australian city – Latimore believed his credibility within the steel sector and the fact he was Australian would inch his bid over the line.
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“M Resources will bring operational excellence to Whyalla,” he said.
“We have deep, long-term networks across the world’s most important steelmakers. We have supplied raw materials to the world’s largest steel mills for over 15 years, including companies like POSCO and JSW with whom we have existing joint ventures, and others like Kobe and ArcelorMittal.”
POSCO is a South Korean steel-making company and JSW is an Indian steel giant. Both are supporting BlueScope in its plans for the Whyalla Steelworks.
Kobe is a Japanese steel manufacturer, while ArcelorMittal is a European multinational manufacturing business.
Latimore said, “at Whyalla there is a mine, a port, a railway and a steelworks”.
“We already own and operate mines in regional Queensland and New South Wales. We already own and operate the Port Kembla Coal Terminal. We own and operate OneRail which freights around 65 million tonnes per annum of steel making coal,” he said.
“We have brought together the A-Team of technical partners to design and construct a low-emissions steel mill at Whyalla. As a group, they have already built 45 low-emissions steelworks across the world.
“M Resources is about operational excellence, and that is what we mean to deliver at Whyalla, supported by the best steelmakers in the world.”
Asked what the company planned for the ageing blast furnace, Latimore said: “The future of the blast furnace is in the hands of the administrators at present”.
“Unfortunately, a lack of investment by the previous owner has meant it is not currently operational,” he said.
“If it can be restarted, we’ll be able to assess it further and what is required to optimise the blast furnace, once we are awarded the opportunity to run these assets.”
This is in contrast to Jindal Steel International director’s extensive plans for the downed piece of machinery, which includes using the company’s existing Oman operations in the Middle East to produce ‘low-emissions blooms’ – semi-finished blocks of steel ready for the steel rolling mill – that would be shipped to Whyalla.
It would mean steel production could continue while JSI tackled overhauling Whyalla’s ageing blast furnace.
But Latimore said he had “specific and unique proposals” for the Whyalla Steelworks.
“In general terms these are about developing a range of high value niche products,” he said.
“This will include long steel products like rail. We will also develop high quality plate products to supply to defence to support the AUKUS submarine building program.
“Our advantage will be the supply high value steel products and we have some exciting plans which set our bid apart.”
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