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Build & Sustainability

Teesside steelmaking poised for revival in £1.25 billion British Steel blueprint

Steelmaking could return to Teesside in £1.25 billion plans.

British Steel has unveiled a blueprint to build an electric arc furnace at its Lackenby plant, near Redcar.

Bosses say the venture – described as the “biggest transformation in its history” to cut carbon emissions – would provide steel for the company’s Teesside Beam Mill base and a special profiles factory at Skinningrove, east Cleveland.

Earmarked to open in late 2025, the furnace would revive Teesside steelmaking, which ended in 2015 when SSI UK collapsed into liquidation.

Teesside redevelopment bosses say the move will create “hundreds of direct jobs”, with “thousands more” supported during construction and the supply chain once operational.

According to British Steel’s plans, its Teesside investment would be complemented by a sister operation at the company’s Scunthorpe site, where the business is planning to close traditional blast furnaces – which are fired by coke, iron ore, sinter and limestone – reportedly putting up to 2000 jobs at risk.

Xijun Cao, British Steel chief executive and president, said: “Decarbonisation is a major challenge for our business.

“Detailed studies show electrification could rapidly accelerate our journey to net-zero and ensure we can provide customers with the steel they require.

“We studied having one large electric arc furnace in Scunthorpe, which was capable of manufacturing all the steel we require for our rolling mills in the Humber and the North East.

“However, such a large furnace would require a new national grid connection, and it is anticipated this would not be available until 2034.

“We therefore believe the most viable and timely option is to have two smaller furnaces, which combine to produce the volumes of steel we require.”

Reacting to the news, Councillor Alec Brown, leader of Redcar and Cleveland Borough Council, described the plans as “fantastic news”.

He added: “Generations of families in Redcar and Cleveland has prospered through employment in the steelmaking industry.

“The closure of the Redcar blast furnace was a huge blow, but British Steel has continued to invest in its operations and workforce at both Lackenby and Skinningrove.

“The expansion at Lackenby is a real demonstration of faith in Redcar and Cleveland.”