It will be even tougher for the proposed steel mill to get off the ground.
It will be even tougher for the proposed steel mill to get off the ground.

Search for investors ongoing, despite steel mill setback

LATEST: 'Reasonable chance': Project director hopeful for steel mill 

UPDATE 9.30am:  

THE director behind the proposed Gladstone Steel Plant Project says they will continue to look for investors, despite the State Government cancelling its 'Coordinated Project' status. 

Paul Sundstrom told The Observer  this morning the company was now working with Sydney consultants, in a bid to find new investment in the project. 

Mr Sundstrom said they were seeking $8 billion to go ahead. 

He said this would allow the company to give the State Government proof of their finances, a project timeline and other relevant information for an Environmental Impact Statement. 

"Its disappointing we haven't produced an outcome but we're still in there trying," he said. 

Mr Sundstrom said they first started working with the Sydney consultants early last year. 

While initially he was "very concerned" about the State Government's decision to cancel the project's 'co-ordinated project' status, he said the steel mill could still go ahead. 

Earlier 5am: 

THE State Government has dealt the latest blow to the Gladstone Steel Plant Project, which was once touted to create 1800 jobs.

Late last year Queensland's Independent Coordinator-General canned the "co-ordinated project" status for the 11-year-old project.

A spokesperson for the Coordinator-General said the cancellation was due to a lack of information for an Environmental Impact Statement.

They said the proponent (Euroa Steel) failed to meet the requirements of providing further details for the document after a draft copy was released for public comment in 2013. They said for this reason, they saw no rationale in extending the status.

This means the project has lost the 591 hectares of Gladstone State Development Area land that was allocated for the project.

Member for Gladstone Glenn Butcher said if the company "was still serious" about the steel mill, they would need to resubmit an application.

The steel plant project had been on and off the table since November 2008, when Boulder Steel first submitted the application for the $6billion project.

After financial difficulty, Boulder Steel Ltd and Gladstone Steel Plant Project were placed in administration in July 2013.

A rescue group was established, headed by Gladstone engineer Paul Sundstrom.

The group raised $50,000 from investors and in August 2014 Boulder Steel was out of administration.

To go ahead, the proposal needed a $6 billion investment from Malaysia, but it is understood no deals were signed.

By mid-2016 a change in direction was announced.

The project downsized to a $20 million pilot plant which would use red mud from Queensland Alumina Limited to process into steel.

Graeme Bartlett and Paul Sundstrom are the Gladstone-based directors for Gladstone Steel Pty, the former Boulder Steel rescue group. Photo Mike Richards / The Observer
Graeme Bartlett and Paul Sundstrom are the Gladstone-based directors for Gladstone Steel Pty, the former Boulder Steel rescue group. Photo Mike Richards / The Observer Mike Richards

In an update to investors in March 2017, company director Mr Sundstrom said they would approach the Bowen Basin Jobs Package committee for funding.

"The prospects of achieving a steel mill are still good, although it will probably be a smaller boutique mill," he said.

Mr Butcher told The Observer yesterday he held concerns for residents who invested in the project.

He said should they want to resubmit their application to go ahead, land at the Gladstone State Development Area would be available.

"I know people who have lost money on this," Mr Butcher said.

"It's been five years since the EIS was lodged and there's been no action since then.

"They've been backwards and forwards with changes of ownership, changes to the people who want to invest and it's eventuated to nothing."

He said the cancellation of the "co-ordinated project" status showed the State Government was serious about creating opportunities within State Development Areas.

Describing the 591 hectares marked for the project as "prime real estate", Mr Butcher said once this land was available again it would be a huge business opportunity.

"It's a flat block of land with a railway going past it, so I'm sure once it's available this will open the door to a project that will take off," he said.

He commended Mr Sundstrom for trying to get the project off the ground.

The original EIS draft, published in 2013, said the project would employ locally and provide "considerable direct and flow-on social benefits" for the Gladstone region.

"Co-ordinated project" status is given to significant projects and allows proponents to receive help from the Office of the Coordinator-General through the complex government processes.

Mr Sundstrom was approached for comment, but could not be reached by deadline.