Owners of the troubled Whyalla steelworks have been warned to pay their mounting debts, as the South Australian government reassures residents of the plant's future.
The South Australian government is "preparing and planning for any number of scenarios" at the struggling steelworks, Premier Peter Malinauskas said as he called on GFG Alliance and its billionaire British chairman Sanjeev Gupta to pay up.
The company owes "tens of millions" of dollars to both creditors and in outstanding royalties to the State Government.
Mr Malinauskas said that he wanted to reassure the people of Whyalla that "we are more optimistic than ever about the future of the steelworks in the long run".
"The time is now for Mr Gupta to front up, pay his creditors, but also demonstrate his capacity to invest in the steelworks for the long-term," he said.
"We stand ready to respond in the event that he's unable to do that."
The intensified pressure comes as US President Donald Trump shocked trading partners by announcing 25 per cent tariffs on all steel and aluminium imports, suggesting that Australia will not be exempt as it was during his first administration.
GFG announced in January that the plant had cast its first steel following a four-month shutdown attributed to operational challenges and extensive repairs, but the blast furnace was running at half its capacity "with a number of issues yet to be resolved".
There are more than 1000 workers at the steelworks and hundreds more at associated contractors. GFG Alliance says the steelworks represent over 43 per cent of the local economy and 42 per cent of local employment.
GFG has been contacted for comment, but so far there has been no public response to Mr Malinauskas' demands, or any update on the steelworks' output.
"The South Australian Government is all-in on this," Mr Malinauskas said.
"We have been working for months now, preparing and planning for any number of scenarios with GFG."
As the nation's only structural steel manufacturer, the steelworks are crucial to long-term economic sovereignty.
The increasing doubt over GFG's ability to pay its bills also prompted Mr Malinauskas to refuse to guarantee the government's $600 million investment in a new hydrogen power plant and storage facility at Whyalla.
Asked if the government was considering spending the $600 million elsewhere, he said it would be "used for the expenditure (on) the economic opportunity in Whyalla".
GFG last year delayed by two years a $500 million upgrade to install an electric arc furnace at the steelworks that is crucial to the transition to green steelmaking.
"We've got to keep an eye on what's going on in the steelworks," Mr Malinauskas said.
"If we produced a hydrogen facility without the steelworks being a customer of the hydrogen — because GFG doesn't invest in the steelworks or, worse still, found itself in even more challenging financial circumstances than it is currently in — then we put ourselves in a precarious position."
