British Steel could run on UK coal despite Labour claims

Telegraph

17-04-2025

British Steel executives have admitted that UK coal could fuel its blast furnaces, adding to pressure on Ed Miliband over the blocking of a new Cumbrian mine.
Richard Tice, the deputy leader of Reform UK, said executives confirmed to him last week that coke derived from the mine's coal would have been of a sufficiently high purity for steel production.
A source close to the steel company suggested the coal could be used following processing.
It comes after Downing Street claimed Cumbrian coal would not have helped in the rescue of British Steel. A No 10 spokesman said on Monday: 'The proposed coal mine in Cumbria wouldn't have helped at Scunthrope.'
The takeover of British Steel left the Government scrambling to secure supplies from abroad to keep blast furnaces going, with shipments of raw materials from the US and Australia eventually secured.
Tory and Reform MPs have claimed the steelworks could have relied on British coal if proposals for a mine in Cumbria had not been blocked.
Mr Tice charged that emissions-obsessed ministers had reinforced that view because of an ideological opposition to blast furnaces.
He said: 'There is deliberate lies and misinformation going on here by the Government, Labour and the eco-zealots. Part of their strategy to get the Cumbrian mine banished was to infer that it wasn't suitable for UK steel making.
'This is not true. British Steel executives have told me that they were very happy to use the coking coal from the Cumbrian coal mine that was proposed.'
Planning permission for a coal mine at Whitehaven was granted by then levelling up secretary Michael Gove in 2022. It would have been Britain's first new coal mine in 30 years.
However, the project was blocked by the High Court in 2024 following a campaign by environmental groups. Angela Rayner's decision not to challenge the ruling led to the plans being dropped, with West Cumbria Mining withdrawing its application this year.
Ed Miliband, the Energy Secretary, vowed to shut the project when in opposition. In 2022, he said: 'A Labour government will leave no stone unturned in seeking to prevent the opening of this climate-destroying coal mine, and instead ensure we deliver the green jobs that people in Cumbria deserve.'
A Downing Street spokesman this week said British Steel had said it could not have used the coal from Cumbria. They said: 'My understanding is that British Steel had previously expressed concerns around the sulphur content of that coal. Eighty-five per cent of that coal was due to be exported.'
However, Mr Tice cited data from commodities markets analysts S&P Global Platts indicating that Cumbrian coal – classified as of being of the 'grade A' type suitable for steel making – had a similar profile to US supplies purchased by the Government this week.
Mr Tice said that the insight from British Steel and the technical comparisons suggested that Labour MP Chris McDonald had 'misinformed the House' when he sought to undermine the argument in favour of Cumbria coal in an emergency debate last Saturday.
He said: 'Chris McDonald is an electric arc furnace zealot, he's been trying to get rid of the blast furnaces, and part of his strategy to do so is to infer that we can't use our own coal.'
The revelation that Cumbrian coal could have been used at British Steel will add to pressure on Mr Miliband.
Critics charge that his overzealous approach to net zero has harmed the economy and energy security. It has provoked speculation that the Energy Secretary's position could be at risk in an expected Cabinet reshuffle over summer.
Mr Tice claimed British Steel-owner Jingye had argued the coal was unsuitable in order to make the plant reliant on its own supply chain in China.
The Boston and Skegness MP said: 'Jingye were using their international supply and sales network. The last thing they wanted to do was use UK coal. Cumbria, frankly, was going to get in their way.'
Research conducted for West Cumbria Mining from Dr Neil Bristow, a consultant and former chief analyst at Australian mining giant BHP Billiton, showed that coal extracted in Cumbria would cause the same volume to be left in the ground in the US.
That would mean that no extra CO2 would ultimately be emitted, while at the same time, emissions from transporting the coal would be greatly reduced.
Mr Tice said: 'Until literally three weeks ago everybody was expecting that Jingye were going to do a deal with the Government, close the blast furnaces and build electric arc furnaces.
'Now all of a sudden everyone is now in love with blast furnaces. The hypocrisy here is quite extraordinary.'
A British Steel spokesman said it was focused on sourcing 'the best and necessary materials needed to keep our operations running.'
However, a source close to the company said that the sulphur content of Cumbrian coal would require it to be blended with other supplies if used in Scunthorpe's furnaces. A lack of specialist ovens would also require Cumbrian coal to be sent abroad for processing and then re-imported, the source said.
Mr Tice acknowledged that Britain would need to invest in coke ovens to establish a full steel supply chain but said this could be done either by reviving Scunthorpe's ovens – closed by Jingye in 2023 – or establishing new ones at a price of about £20m.
The Reform MP said he was working on a plan for the steel industry including the refurbishment and relining of Scunthorpe's two blast furnaces at a cost of £200m apiece.
He said two electric arc furnaces in Rotherham owned by Liberty Steel and idle for three or four years could also be purchased by the Government at minimal cost.
He said: 'You'd have a couple of arc furnaces, a couple of blast finances and long-term procurement contracts on scrap steel for the arc furnaces, coking coal and iron ore for the blast furnaces, and sales contracts of 10 or 15 years with regular buyers.
'That will deliver a viable, tangible business that everyone understands and knows, and that you can predict on.'
A government spokesman said: 'The Labour Government is focussed on securing our steel industry to protect British jobs and British workers. Whitehaven would not have prevented the situation British Steel has faced and those suggesting otherwise are wrong.'