According to the Tata Steel subsidiary, the furnace is to undergo a rebuild, starting in July 2012, which will equip it with technology to improve its safety, environmental performance and reliability.
The steel producer also claims that the project will yield the additional benefit of balancing the iron- and steel-making capacities at Port Talbot, increasing the capacity of the two blast furnaces by up to 400,000 tonnes a year.
Kirby Adams, Corus managing director and chief executive officer of Tata Steel, said: ‘This investment is a major step in achieving Tata Steel’s ambition to position Port Talbot as a producer of high-quality strip products on a global scale and an internationally competitive cost base.
‘Our capital expenditure decisions aim to invest in those who invest in themselves. The commitment and capability shown by our South Wales employees to meet the challenges posed by the downturn, together with the constant support we have received from the Welsh Assembly Government and the local community and unions, are important factors that have led to this decision.
‘As a result of this project, the Port Talbot works and our downstream supply chain will be able, in the coming decades, to continue to improve the quality of products and services provided to its UK and overseas strip product customers.’
David Ferris, chair of the Multi Unions at Port Talbot, added: ‘Following our recent announcement that we are taking on some 150 young people, this news promises them a strong future – and a sustainable future for the whole community.’