MORE than 500 jobs have been lost after it was announced that the smelter at Lynemouth’s Alcan plant is to close.
The devastating news from parent company Rio Tinto comes as part of its programme to streamline its international business.
It has faced rising costs since new environmental legislation came into force last year, which requires it to buy allowances for its sulphur and nitrogen oxide emissions.
The company has said this change and a drop in the price of aluminium has wiped out its profits and now it is just over breaking even.
There would be an even greater financial burden in 2013 from the introduction of European and UK carbon emission levies.
The power station and smelter is Northumberland’s biggest private sector employer and the latter provides 510 jobs.
In response to the announcement, Northumberland County Council Leader Jeff Reid said: “This is very sad news for those who are employed at the plant and their families, as well as for the local community as a whole.
“We have been working very closely with the company and partners, including central Government, in the hope that a solution could be found.
“Now we want to do everything that we can to support those affected and to focus on creating new employment opportunities in an area which is losing its biggest private sector employer.
“We have established an internal group to support those who are losing their jobs, including looking at opportunities for training. The council is also working hard to secure support for a growth package for the area.
“We will continue to work with the company throughout the process, as well as with other companies in the supply chain, to highlight key issues, and establish ways that the council and our partners can help.”
Bosses said last month that they were hopeful a buyer can be found for the power station, which employs 120 people.
But no offer had been made for the smelter and its closure was an option.
Berwick-upon-Tweed MP Sir Alan Beith said: “This is the very bad news we have been anticipating for weeks now and means that every effort must be made to bring new jobs and business expansion to Northumberland.
“I am continuing to hold discussions with the Business Secretary Vince Cable to press the case for an Enterprise Zone for the area and for any other measures which could help to bring forward new jobs.”
Rio Tinto Alcan confirmed that it was closing the smelter.
Preceding it will be a 90-day consultation process with employee and union representatives.
Jacynthe Côté, Chief Executive of Rio Tinto Alcan, said: “This decision follows a thorough strategic review which explored every possible option for continuing to operate the smelter.
“For 40 years, the Lynemouth smelter and power station have been important parts of the community and we will work with our employees and other key stakeholders to ensure that the social and environmental consequences of today’s announcement are managed in the most sensitive way.”