STEEL unions have welcomed plans by Thai firm Sahaviriya Steel Industries (SSI) to expand the Teesside Cast Products (TCP) plant, potentially creating more jobs, should a deal for the facility go through.

The firm is expected to complete the £320m purchase of Tata Steel’s mothballed plant in Redcar, east Cleveland, within the next two months.

Speaking to industry publication Steel Business Briefing (SBB), the company’s president Win Viriyaprapaikit said: “When we have stabilised production, the next step will be to look at that (expanding capacity), because it is the wish of the Teesside people that we invest in the output, which will provide more jobs and more income for the community.”

Last night, Community Union national officer Roy Rickhuss said: “We welcome Mr Win’s ambition to increase steel production on Teesside.

“SSI recognises the worldclass workforce and production facilities that Teesside has to offer.

“We look forward to hearing more about their plans to expand steelmaking and we’re also encouraged that the deal will be completed soon.”

Mr Viriyaprapaikit has previously confirmed that the 700 steelworkers who remained at the facility after its partial mothballing would be kept on.

In the interview with SBB, Mr Viriyaprapaikit made mention of the fact SSI had been in discussions with the UK Government following concerns that EU carbon emissions rules could get in the way of it expanding production.

He said: “We do not want to be penalised for any expansion, particularly as all the output will be exported to Asia.”

Firms are given an allowance as to how much carbon can be emitted and, if it is exceeded, must pay extra, potentially putting them at a disadvantage to firms outside the EU.

Following a meeting with Climate Change Minister Greg Barker last week, SSI has been assured that any expansion of the TCP site would not be hindered, as the EU recognised some energy intensive industries needed special treatment.

SSI will ship TCP’s slab to its hot strip mill in Thailand, while some might also go to its affiliate, Sahaviriya Plate Mill.

Last month, SSI announced it intended to raise about £112m towards the purchase of the steel plant and expand the facility in the next two years, through a rights issue, subject to shareholder approval at a meeting in Bangkok next week.

Once any acquisition of the plant is completed, it is expected to be operational again within about six months.