Tata Steel is to proceed with its £1.25 billion investment to build an Electric Arc Furnace in Port Talbot and will start closure of the existing heavy end assets in the coming months.

The company has informed trade unions that Port Talbot’s two blast furnaces – No.5 and No.4 – will close by the end of June and by the end of September respectively.

It says discussions will continue with trade unions during the next two weeks on a potential Memorandum of Understanding on the future ambitions of the business and the impact of the restructuring on employees. A Voluntary Redundancy Aspiration process will be launched across Tata Steel UK from May 15.

Tata Steel has also started preparations to place equipment orders for the Electric Arc Furnace by September, with a view to begin enabling and preparatory works at the site by December. It says that, based on current timelines, construction on the project could begin by August 2025.

A Transition Board to support the people, businesses and communities affected by the proposed transition to low-CO₂ steelmaking was established in October 2023.

The Tata Steel / Port Talbot Transition Board, chaired by the Secretary of State for Wales and including representatives from Welsh Government, local authorities and industry, has  £100 million to directly support those affected. £80 million of this is from the UK Government and £20 million from Tata.

The Board met on April 25 to agree the way forward to release funds to help the thousands affected by the plans.

Secretary of State for Wales David TC Davies said:

“Tata Steel have announced the end of the consultation period for workers impacted by their decision to move to greener steel-making. Of course this is an extremely concerning time for the workers and for the wider community.

“The UK Government set up the Transition Board to help affected workers and met today in Port Talbot where partners agreed an overarching plan for how workers can best be supported.

“Under the plans there will be funding for the retraining of steelworkers, support for businesses in the supply chain, and investment in regeneration projects in Port Talbot.

“As soon as possible the Transition Board will move onto the next phase of our work and spend our £100m budget where we know it is needed.”

The UK Government says the next steps will be to agree the detail behind each business case and release the funds with the focus now on progressing this as quickly as possible.

At its meeting the Board agreed that supporting affected employees to find new well-paid jobs will be its first priority and said it will also prioritise supporting businesses affected in the supply chain.

The Board also said it recognised the importance of longer-term regeneration of the region.  It was agreed that a Local Economic Action Plan, which was presented to the meeting, would be overseen by Neath Port Talbot Council and used as a basis for investment, subject to business cases being presented to the Board at subsequent meetings.