The Anonymous Widower

Network Rail Bids For Part Of British Steel

The title of this post, is the same as that of this article on the BBC.

This is the first paragraph.

Network Rail is looking to buy part of British Steel, as bidders have until the end of Sunday to put in offers for all or part of the troubled firm.

Many would say, why does the nationalised industry Network Rail, which let’s face it, has had its troubles in recent years, want to get involved with a bankrupt company?

You have to remember, how big companies work.

  • They need to manage their cash flow.
  • They need quality supplies, that will do what it says on the specification.
  • They want supplies to be delivered as and where they need it.

But above all they need to be properly financed.

Making And Delivering Rails

This paragraph in the BBC article says a lot.

Network Rail owns and operates the UK’s railway network, including 20,000 miles of track, and buys 100,000 tonnes of rails from British Steel each year.

Suppose, you want to lay new rails urgently between Inverness and the Far North of Scotland. Getting it there will be a logistics problem, which will be made worse, if the source is halfway around the world.

And suppose, when it arrives in the UK, it fails the quality test! You can’t just give it back to the postman.

So for a reliable railway, Network Rail also needs a reliable supplier making rails, close enough for product to be delivered by special train.

From what I have read in the railway press, British Steel are good at the following.

  • Manufacturing quality rail.
  • Developing special products for rail companies.
  • Delivering it on special trains.

To illustrate this, read British Steel Secures Major Contract From Deutsche Bahn.

I also think, that in addition to the Germans, British Steel sell rail to the Belgians, French and the Dutch, to name but three.

So certainly, British Steel seem to be on the ball with making and delivering rails.

But they appear to be seriously underfunded.

Acquiring British Steel

If I was a financier, thinking about taking over British Steel, one of the most important things would be to secure the sales and the resulting cash flow for the company.

I would be on the train to all of the major rail infrastructure companies, that could be reached by British Steel’s special trains from Scunthorpe.

Network Rail have already put a marker down, that they would buy British Steel’s Rail Products Division, but are other rail infrastructure companies also looking at securing quality product, by either buying the division themselves or pledging support alongside Network Rail.

Network Rail are also aware that their predecessor Railtrack, was brought down by the Hatfield Rail Crash, so they are probably and rightly so, paranoid about safety.

The very fact that Network Rail have put in a bid, suggests to me that they know their power in the negotiations to follow, as any purchaser, who doesn’t have the major customers onside, is probably doomed to fail.

On the other hand, if British Steel was bought by someone, that would increase the risk of dodgy product, Network Rail would go elsewhere.

But would they be able to get the same quality and service?

Conclusion

I am sure, that Network Rail, Deutsche Bahn and all the other rail infrastructure companies will play a large park in the fate of British Steel.

 

July 1, 2019 Posted by | Finance, Transport | , , | Leave a comment

Northumberland Park Station – 22nd October 2018

Northumberland Park station is coming on.

It’s going to be a complicated steel construction.

Some people will like it! Other’s won’t!

I do suspect though, that there will be some superb photographs of this station, when the light is similar to how it was today.

October 22, 2018 Posted by | Transport | , , , | 1 Comment

Steelworm At Whitechapel Station

I took this picture at Whitechapel station.

It looks like steel’s equivalent of woodworm has been at work!

 

September 19, 2018 Posted by | Transport | , , | 2 Comments

British Steel Secures Major Contract From Deutsche Bahn

The title of this post is the same as this article on Global Rail News.

I thought the article had a touch of Coals-to-Newcastle about it.

But read the article and there are a lot of things coming together to enable the order.

  • British Steel have spent a seven-figure-sum at Scunthorpe, to make the longer rails, that the Germans use.
  • Deutsche Bahn are Europe’s largest purchaser of rail.
  • The initial order is for 20,000 tonnes of rail.
  • Rails can be delivered in 120 metre lengths through the Channel Tunnel.

I should say, that I’ve read in the past, that Scunthorpe makes a quality product.

I found this video on the British Steel web site.

It all brings back memories of the time, I spent as a sixteen-year-old putting automation on heavy machines use to roll non-ferrous metals.

I doubt you get work experience like that these days!

March 15, 2018 Posted by | World | , , , , | 4 Comments

Could New Technology Help Save Steel Jobs?

One of my first jobs was in the instruments laboratory of Enfield Rolling Mills in the early 1960s. As someone with a mind like a sponge, I never missed storing away every piece of useful engineering and scientific information, I might encounter.

The company was involved in the rolling and the production of materials from non-ferrous metals, like copper, bronze, brass and aluminium. For instance, they did a lot of work with the continuous casting of metals like bronze and aluminium.

The company also used scrap metal as a source of raw material for their processing. One of their problems was identifying the scrap before processing and they had experimented with using a radioactive isotope to see, if it could give them an accurate opinion.

It probably wasn’t the best thing to do!

But since then technology has moved on.

I just wonder now, whether mass spectrometry could correctly identify the exact grade of a large piece of brass, bronze or steel!

If it could, I suspect that we could use our scrap metals to avoid refining new.

So I searched using “automatic steel scrap sorting” and found this page entitled Laser Methods For Automatic Scrap Metal Sorting.

And this page on the Oxford Instruments web site entitled Scrap Metal Analysis, Sorting and Recycling.

Who needs blast furnaces?

We just mine the scrap, rather than send it to China!

 

April 22, 2016 Posted by | World | , | 3 Comments

Sense About Steel

This article in the South Wales Evening Post is entitled Swansea Bay Tidal Lagoon one solution to Tata Steel crisis, insists council chief Steve Phillips.

He is right and I said so in The Death Of Traditional Steel-Making.

I also said that in addition to the tidal lagoon, a comprehensive metro should be developed all over South Wales.

 

April 12, 2016 Posted by | World | , , , | Leave a comment

Green Steel

This article on the BBC is entitled Tata Steel: Would-be UK buyer Liberty’s jobs hope.

Sanjeev Gupta, the head of the Liberty Group, is reported as saying this.

We would look to transition from blast furnaces to arc furnaces, from imported raw material to domestically available scrap, from making carbon steel to making what we call green steel – melting and recycling scrap using renewable energy.

As I heard the quote on the radio, I can verify that it is more or less correct.

I don’t know, whether what Mr. Gupta said can be achieved, but it strikes me that it is a feasible idea.

 

April 9, 2016 Posted by | World | , | Leave a comment

The Death Of Traditional Steel Making

If we’re being serious about making steel using the traditional methods of blast furnaces, converters and lots of energy, it’s not a very green process and it contributes to pollution and global warning.

We have a serious oversupply of steel in the world and this page lists production by countries.

In 2014, the world produced 1670 million tonnes of steel, of which we produced just twelve.

Looking at the production levels, there are quite a few countries that produce produce small numbers of million tonnes of steel like we do.

As China produced 822 million tonnes of steel in 2014, how many of these countries will be forced out of steel making in the next few years?

What will save steel making in a lot of countries is improvements in technology.

The parts of the steel industry, that seem to be the most profitable are the downstream uses of the metal, like making rails for railways. In this country, we have a reputation for using steel in innovative ways, but few of these uses need steel made in Britain, although they may need a quality steel to start with.

But that quality steel can come from anywhere with the knowledge to produce it.

China will acquire that knowledge, just as the Japanese did in the 1950s and 1960s.

It is interesting to look at iron ore by country in 2014. Out of a world product total of 3.22 million tonnes, we see.

  • China – 1.5 million
  • Australia – 0.66 million
  • Brazil – 0.32 million
  • India – 0.15 million
  • Russia – 0.1 million

So does this partly explain China’s massive production of steel?

I think Australia and Brazil are the two most important countries on this list. Both have large amounts of energy and because they are ambitious intelligent countries, as the steel-making technology develops, will we see them increasingly becoming makers of quality steel?

I don’t know, but it says to me, that even producing quality steel in a niche market won’t be profitable for long.

The money and employment is in using quality steel, not in making it.

It may be a hard unpopular view, but we should let the rest of the world fight over supplying us with quality steel. If we want security of supply, I’m sure the Aussies would provide it.

As to the steel-making areas like Teesside and South Wales, we have to move on.

The Future On Teesside

In fact Teesside seems to be doing that, if a BBC report this week wasn’t truly negative.

What puzzles me about Teesside, is that there is little mention in the media about York Potash. This is from Wikipedia.

The project intends to mine the world’s largest deposit of polyhalite – a naturally occurring mineral – located on the Yorkshire coast.

The mine site is located outside the village of Sneatonthorpe, between Whitby and Scarborough in North Yorkshire. The project plans to construct two 1,500 m (4,900 ft) shafts to reach the mineral seam which includes a mineable area of around 25,200 hectares (62,000 acres).

To minimise the amount of visible infrastructure within the North York Moors National Park, a protected area, the polyhalite will then be transported 37 kilometres (23.0 miles) in an underground tunnel to the company’s processing plant at Teesside. After granulation and drying, the finished product – marketed by Sirius Minerals as POLY4 – will be exported from the nearby harbour facilities.

Could it be that, this project appears to not be very green and in the minds of many is creating a giant hole in the North York Moors National Park?

My view is that the UK needs more big projects like York Potash, that earn billions of pounds from exports, create thousands of jobs and don’t despoil the environment.

The Future In South Wales

So what have we got for South Wales and Port Talbot in particular?

Nothing as big as York Potash, but there are plans for the world’s first tidal lagoon power station in Swansea Bay Wikipedia says this about the Tidal Lagoon Swansea Bay.

It is planned to be the first of six tidal lagoon power plants to be constructed in the United Kingdom, and one of four planned to be built in Wales. The tidal lagoon would have a capacity of 320 MW.

The project was named as part of the UK government’s 2014 National Infrastructure Plan and was granted planning permission by theDepartment for Energy and Climate Change in June 2015. Power production is expected to begin in 2019. The operational life time of the artificial lagoon is 120 years, effects of global warming have been included in the planning. It is also to be constructed to withstand 500-year-storms and to function as a coastline protection against storms and floods.

So what are we waiting for?

The economics depend very much on the strike price for electricity generated and the Government seems reluctant to set one. I do wonder if they have got themselves tied in knots with trying to build a white elephant at Hinckley Point, that they can’t think of anything else.

Consider.

  • I’m not against nuclear power, but Hinckley Point C is so expensive and its strike price is so high, that it will be a millstone around the necks of energy users for decades.
  • If we want to go nuclear, there are smaller and proven reactor systems available.
  • Electricity generation is going more distributed with the growth of solar panels, local heat and power systems and other technology.
  • Large energy users are changing technology to cut use.
  • The tidal lagoon technology gives protection against storms and floods.
  • Tidal lagoons could be the twenty-first century equivalent of the nineteenth-century seaside pier.
  • If the technology and economics of the tidal lagoon work, it will produce carbon-free electricity for at least 120 years.
  • There are other places, where tidal lagoons could be built.

You could bet your life on the Dutch building a tidal lagoon, but they don’t have the tides.

Rather than back a doomed steelworks, the Government should back the unique energy project of the Tidal Lagoon Swansea Bay.

If the energy economics don’t work out, you still get the coastal protection and leisure facilities.

A Metro For Teesside

The Tees Valley Metro has been in planning mode for some years and I can’t understand why it hasn’t happened yet.

All that seems to have happened is the opening in 2014 of James Cook University Hospital station, which I wrote about in James Cook Station – The Reinvention Of The Halt. The station certainly seems to be attracting a level of use, typical of a station of its type.

I also wrote about the metro in The Creation Of The Tees Valley Metro.

A Metro For South Wales

The Welsh are also keen to create a South Wales Metro for some time. I wrote about my observations on the trains in the area in The Welsh Could Be Having A Lot Of Fun Playing Trains In The Cardiff Valleys.

This project should be beaten into action as soon as possible.

It is interesting to take a look at a Google Map of the coast between Swansea and Port Talbot.

Swansea To Port Talbot

Swansea To Port Talbot

I don’t know the area well, but I know many people, who have enjoyed leisure time spent all along the South Wales Coast.

Perhaps, if the steelworks were to be closed, it could be treated to a Barcelona solution, where their steelworks was closed and the area turned into beaches and parks, which formed part of the Olympics in 1992.

The Tidal Lagoon Swansea Bay would be generally sitting in the western part of the bay.

I believe that a comprehensive South Wales Metro, could go a long way to creating more jobs, than will be inevitably lost at Port Talbot.

Conclusions

Steel production is virtually dead in the UK and we must move on.

If we can find an innovative project to replace steel making, we should back it and as with York Potash, it doesn’t necessarily mean billions of public money.

But decent infrastructure and local rail, tram and bus systems can go a long way to creating the jobs needed everywhere.

In both the examples of Teesside and South Wales, surely if nothin else, a decent metro would give a boost to tourism.

April 1, 2016 Posted by | Transport, World | , , , , , , | 3 Comments

Will The Fight Continue Over Potash On The York Moors?

This article on Grough is entitled Campaigners fight on as North York Moors potash mine formally approved.

As the mine could employ upwards of a couple of thousand people, have the campaigners sent personal letters to all the redundant steelworkers explaining how it is more important that they are unemployed?

How can people be so selfish?

October 21, 2015 Posted by | Uncategorized, World | , , , | Leave a comment

Why Is There No Mention Of York Potash In The Discussion Of Redcar Steelworks?

This detailed article on the BBC entitled What is the outlook for Britain’s steel industry? starts like this.

It is being billed as a top level crisis summit. Government ministers, unions and steel company bosses are heading to South Yorkshire to discuss what can be done to help an industry hit by tough global market conditions.

UK steelmakers say it’s getting harder to compete because of high energy costs, green taxes, the strong pound and cheap Chinese imports flooding the market. Compared to foreign competitors, steel unions warn the cost of making steel in the UK is too high.

The recent closure of SSI’s steelworks at Redcar in Teeside, with the loss of more than 2,000 jobs, has brought into sharp focus the difficulties facing the industry. The Thai firm said a slump in demand for steel was behind its decision.

At other steelworks across the country, from South Wales to Scunthorpe to Rotherham, union leaders says thousands of jobs are hanging in the balance. So what’s next for the UK’s steelworkers?

But with regard to Sirius Metals and the creation of one of the world’s largest potash mines and processing facility; York Potash, there is not a word.

I’m afraid that in a few years there will be little steel-making in Europe, let alone the UK, as other countries with lower costs will undercut Europe on price.

On this page of the York Potash web site, there is an impressive video about the mine and its processing facility.

This must be one of the hopes for the future for Teeside.

I can remember the development of the earlier potash mine at Boulby, when I worked at ICI around 1970. This section is the history of the Boulby mine, and it would appear to have a future. The potash is removed to Teesport, using a reopened section of the Whitby, Redcar and Middlesbrough Union Railway, which used to connect Middlesbrough to Whitby, in addition to the still operating Esk Valley Line

In contrast the York Potash ,mine will use an underground conveyor to move potash from South of Whitby to its processing facility at Teesport.

There is still another railway in the area, which is the heritage North Yorkshire Railway, which connects Whitby and Pickering. According to this section in Wikipedia, it has ambitious plans to connect to the York to Scarborough Line, thus giving the possibility of steam services between Scarborough and Whitby.

I believe that the Tees Valley Metro can be developed.

Like many places in the UK, I believe that services on all the lines from Morpeth and Newcastle in the North to Middlesbrough, Darlington and Whitby in the South could be run using Aventra IPEMUs with a small amount of selected electrification.

Which brings me to the conclusion that Redcar steel works will be closed and Potash mining and a developed Tees Valley Metro will be better for the area, than pouring millions down the black hole of the steelworks.

October 16, 2015 Posted by | Transport | , , , , | Leave a comment