STEEL bosses have celebrated production records at a North-East plant but admitted the start of a vital £38m coal injection facility has been delayed by weeks.

The collapse of Wales-based steel contractor Rowecord Engineering, which was installing the PCI (pulverised coal injection) plant at SSI UK in Redcar, has been the latest setback to the introduction of a system that is key to the firm’s long-term survival.

It is estimated that every week the PCI project is delayed could cost SSI in the region of £1m. 

The original plan would have seen PCI start in January before high winds and a third party industrial dispute stymied progress. It was then due to open on May 28, and is now expected to be commissioned in June. 

The new facility will cut costs and boost the amount of iron produced in the blast furnace from 8,500 tonnes of iron a day to 10,000 tonnes, helping the loss-making making business make a profit for the first time since production restarted in April 2012.

It will also see the plant source all of its coal from a local supplier, Hargreaves Services of Esh Winning, County Durham, instead of importing materials from Russia and Australia.

But SSI has been heartened by this month’s production figures, which are akin to the type of levels it expects to hit when PCI comes on stream. 

On May 7, a record 10,168 tonnes of slabs were cast during the 24 hour period, and this was followed up by a new weekly record output of 61,118 tonnes achieved last week. 

Phil Dryden, the chief executive of SSI UK said: “These records signify real milestones for everyone connected with SSI UK. The new daily record represents the production target we will be striving to achieve after the PCI plant starts up.

“To demonstrate this kind of production capability prior to the commencement of PCI is hugely encouraging and is a great indicator of the potential this operation has.

“I congratulate all of the SSI UK colleagues and particularly the operating teams on their great performance, and I am looking forward to us creating further records in the months and years ahead.”

SSI reacted swiftly to Rowecord entering administration by appointing suppliers such as Thornaby-based Leven Bridge, to complete the work. 

Mr Dryden, added: “The main mechanical contractor, who had been employed on the PCI Project, recently went into administration and their withdrawal has had some impact on the planned start up date scheduled for the end of May. 

"The work has now been reassigned and therefore the overall impact of this event is limited to weeks. The commissioning processes are underway on the PCI plant and the first coal injection in to the blast furnace is expected in June.”