On 13 September 2026, KordaMentha confirmed what months of failed restart attempts had already suggested: the Whyalla blast furnace is permanently closed and beyond repair.
That ends the coal-based route at Australia’s only producer of rail and structural steel sections, and it settles an argument that had been running since the furnace shut unexpectedly in early April 2026. Both remaining bidders for the site propose direct reduced iron plus an electric arc furnace rather than rebuilding a 1960s-era furnace.
Project Scope
The furnace was commissioned in 1941 and the site became a fully integrated steelworks in 1965. The South Australian government placed OneSteel Manufacturing into administration in February 2025 under purpose-built state legislation, removing GFG Alliance from control. KordaMentha has run it since.
The Commonwealth and South Australian governments committed a joint 2.4 billion dollar assistance and transformation package, of which 1.9 billion is for the transformation itself. That is a funding commitment, not a construction contract. No contractor is engaged, and the end-state scope will be set by whoever buys the site.
Two bidders remain: Jindal Group and M Resources. Premier Peter Malinauskas has said a transaction is on track to complete by the end of 2026. Up to 500 employees and 100 labour-hire contractors are affected by the furnace closure.
The governments’ stated preferred outcome is a pit-to-port low-emissions iron and steel facility drawing magnetite from the Middleback Ranges, running on grid electricity and eventually lower-carbon fuels.
Why It Matters
Governments rarely get to choose a steelworks’ technology pathway. Here an insolvency handed them that choice, and the assistance package plus the sale process together function as a procurement for a DRI and EAF plant that nobody has yet designed.
For contractors, this is a large brownfield industrial opportunity about to come to market with the demolition scope already defined by a furnace that can’t restart. For everyone else, the magnetite resource next door and the port are the reason the site has a future at all. Sovereign capability in rail steel is why the money showed up.
Timelines depend on a sale closing. Read them accordingly.
Project Team & Details
| Owner / Client | OneSteel Manufacturing (in administration); KordaMentha appointed administrator |
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| Status | On Hold |
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| Funding Source | Mixed |
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