The Government has provided £71m to assist in the clean-up and remediation of the former Sahaviriya Steel Industries steelworks site in Redcar, so that it can be redeveloped as a business park.
It is the first Treasury commitment to the North since prime minister Boris Johnson visited Sedgefield in County Durham the day after the Conservatives’ victory election victory and pledged to "re-pay the trust" of former Labour voters. The Redcar constituency was lost by Labour’s Anna Turley and won by Jacob Young – the first Conservative ever to hold the seat.
The plant shut when SSI went into liquidation in 2015, causing the loss of 3,000 jobs. Redevelopment had been held up because three Thai banks hold a charge over the assets of SSI which had acquired the site in 2012 from Tata Steel.
Attempts to buy the land have been conducted for the last three years without success, but the first stage of a legal challenge will begin next month. Ben Houchen, Tees Valley Mayor, said that the government money would help the South Tees Development Corporation (STDC) to undertake a compulsory purchase order (CPO), requiring the banks to relinquish the land.
He said: "The only major objection the Thai banks have is we don't have the financial wherewithal to deliver the plans. This £70m government has committed today means we do have the wherewithal and we're in an extremely strong position going into the CPO inquiry next month."
Funds of £137m had already allocated by STDC to keep the 1,800 ha site safe. It contains 27km of pipework as well as old torpedo sheds a blast furnace and coke ovens. Site clearance and clean-up could take from five to seven years.
STDC would like a consortium of six global oil and gas giants called OGCI to move onto the site with carbon capture technology. The process will be simpler if the CPO is successful, because all of the land will be combined into one package.
STDC owns a larger adjacent area which it bought from Tata Steel in 2011 for £11.5m. An STDC masterplan was drawn up in 2017 for the former industrial belt south of the Tees, designed to create 20,000 jobs in the next 25 years and create £1bn for the economy. Redcar's coastline, port and the SSI site are seen as offering exciting opportunities for green industry, leisure and culture as well as heavy industry. Mayoral elections for the Tees Valley will take place this May.
If a CPO is granted the Krung Thai Bank Public Company Limited, The Siam Commercial Bank Public Company Limited and TISCO Bank Public Company Limited will be able to appeal in the High Court.