FERROCHROME producer International Ferro Metals has agreed to shut two of its furnaces to help power utility Eskom manage tight electricity supply.
International Ferro did not say how much Eskom was paying as compensation but said it was a “net financial benefit to the company”.
The company said it did not expect the shutdowns to significantly impact other mining and ore beneficiation operations, and its contracts with customers. No job cuts were anticipated either.
South Africa has been struggling to meet demand for power as new power plants meant to plug the shortfall have been delayed. Supply will remain vulnerable until the first units of Eskom’s new stations become operational next year.
State-owned Eskom had struck similar agreements with other ferrochrome producers such as Xstrata, Samancor and Ruukki.
Sydney, Australia-based International Ferro produces ferrochrome - the essential ingredient in stainless steel - at its facilities located in South Africa. International Ferro said it would switch out the first furnace in March-May and the second in April-May.
The company had the option to switch the first furnace back on May 1.