The Electrolytic Refining and Smelting Company (ER&S)

The quiet surrounds of a beachside, largely farming area south of Wollongong may have seemed an unlikely location for a new, large heavy industry. The Port Kembla site though offered a major advantage in that a plant might be sited close to deep water access for both Australian and overseas shipping of ore. Other advantages included the availability of coal as an energy source, and proximity to Sydney (and, as suggested by some historians, distance from Sydney). Visiting dignitaries were later to comment favourably on the nature of the Illawarra natural environment, as a location for a smelter.

The company which was set up in 1905 to build the Port Kembla copper smelter (The Electrolytic Refining and Smelting Company of Australia Ltd, ER&S) was owned by Mount Morgan Mining Co (two thirds) and a specialist German metallurgical company Aaron Hirsch und Sohne (one third), with a share capital of £150,000.

Construction of the new plant commenced on 1 February 1908, with smelting commencing in February the following year. It was a complex, modern plant housed in fifteen large buildings, and able to process copper ore (5 – 12% copper), matte copper (semi-processed ore at about 42% copper), blister copper (99% copper), gold concentrates, gold ores, and silver ores, and also to refine ‘dore’ bullion – mixed silver and gold. It was constructed for a cost of nearly £150,000 exclusive of stocks.

Links to the Dapto Smelter

The plant’s construction and staffing provided an interesting link to its predecessor smelter, the Dapto Smelter. That smelter had been built in expectation of the development of a deepwater port on Lake Illawarra southwest of Port Kembla. When that did not eventuate, and influenced also by other economic factors of the time, the smelter closed in 1905.

In 1907 its owner, the Australian Smelting Corporation (ASC) , purchased land at Port Kembla from the state government, with the aim of transferring the Dapto operation to that site. While siteworks were commenced, they did not continue and, with a drop in world metal prices, the company went into liquidation in January 1908.

When the new enterprise commenced construction, the former Port Kembla offices and houses of the ASC were rented for staff use, the office staff transferred to the new company, and siteworks for the new plant were overseen by the former earthworks contractor for the ASC.

Testing Times – and Success

The early days of ER&S were not easy, with low international copper prices in 1909 even causing the company to consider suspension of operations. In 1910, the company managed to secure a contract to refine blister copper for the Mt Lyell Mining Company, which helped underpin ongoing operations. It was the onset of World War I however, with its associated demand for copper for munitions, which finally saw the company enter a period of sustained profitability, a profit of £10,742 being registered for the year ending October 1916. Further equipment construction saw the plant become by 1916 the largest copper smelter and refinery in the British Empire, with a capacity of 30,000 tons of refined copper per year.

Plant and Equipment

The ER&S plant was specifically designed as a custom smelter – that is, with the ability to handle a variety of ores, the design not being premised on a single ore type. It had from the outset a high degree of flexibility of operation, as noted above. That was to be enhanced over the years by the addition of further specialised separation processes. A 1961 plant description for example showed its diversity in input and output materials:

Inputs	Outputs
· ore concentrates· copper matte· white metal· miscellaneous copper ores· gold ores and concentrates from all parts of Australia· copper-bearing residues· low grade copper scrap· blister copper· contaminated high grade scrap copper	· blister copper· refined copper in various forms· copper alloy billets· specialty alloys (eg cable sheathing, white metal bearing alloys)· sulphur-rich off-gas (for sulphuric acid production)· nickel sulphate· copper sulphate· silver, gold, and platinum· palladium, selenium and tellurium

The initial ER&S production plant comprised

– two reverberatory furnaces to produce copper matte from ore, each capable of producing copper matte from 40 tons of ore per day.

– converters to produce blister copper from the matte

– an anode furnace which melted the blister copper for casting to anodes, and provided preliminary thermal refining

– an anode casting machine

– a tankhouse equipped with some hundreds of electrolysis tanks, and all the pumping and process equipment needed for electrolyte handling

– a wirebar furnace to melt copper for casting

– wirebar and billet casting facilities including both batch (billet) and continuous casting

– smaller specialist facilities including furnaces and electrolytic facilities to handle gold and silver

– a wide range of ancillary and support processes includ9ing a sinter plant for blast furnace feed preparation, and rare earth recovery processes.

For a description of the operations of the plant, see here.

The plant was a classical metallurgical operation employing a range of

– physical processes such as sedimentation (in the electrolyte purification and slime settling stages)

– thermal processes such as evaporation of nickel-bearing acid solutions

– pyrometallurgical processes such as the blast furnaces and converters, and

– electrochemical separation processes, applied to a range of metals in the tankhouse.

The overall production configuration was flexibly designed, such that materials could enter at virtually any stage of the process, and be subject to one or many stages of refining. It was a complex plant.

Plant Development

Over the years the plant saw substantial capacity expansion and plant upgrades (though none of the scale of its last major upgrade in 1999 described below). Plant upgrades included a new sinter plant and blast furnace in 1958, and a range of lesser equipment additions. Reflecting the variability of product markets and consequent profitability, there were also long periods when capital expenditure was at a minimum, and designed only to keep the existing plant operating. Environmental equipment requirements came to absorb a greater part of capital expenditure as community pressures increased over the life of the plant.

One notable initiative undertaken was the pilot and later production operation of a quite radically new technology for copper smelting which combined several process steps (blast furnace and converter) into one furnace unit. The technology was known as the WORCRA process, named after its inventor Dr Howard Worner, and CRA as the supporting company. The process was commissioned in 1968 and operated intermittently until 1970. It was not however commercialised. Had it been, it would have competed with the flash smelter process which was to become widespread.

Community and Pollution

ER&S was the first large industry to set up in Port Kembla and much subsequent local and regional development owes an acknowledgement to that role, particularly in the provision of employment. That occurred initially at a time of employment stress through the demise of the Dapto Smelter, and later as an ongoing contribution to the development of the Illawarra both directly and also through its several satellite industries, Australian Fertilisers Ltd and Metal Manufacturers Ltd.

The company was also, for the early decades of its life, closely involved in the affairs of the surrounding community, one which it had been in part responsible for creating. Port Kembla was regarded as a ‘company town’ with both the negative and positive connotations that term had. The company and those who worked for it were prominent and influential in many local activities, particularly in the formative years of Port Kembla as a community.

Over the years as the community broadened and developed and other industries took their place in the area, the influence of ER&S was diluted, other than in one notable regard which was to be a feature of ER&S’ relationship with the community for many years. That issue was pollution – atmospheric pollution in particular.

The extent of environmental and health damage arising from acid and related emissions from copper (and other) smelters was far from unknown when the establishment of a smelter was being considered for Port Kembla. Indeed it has been suggested that the location of the smelter at Port Kembla was the result of a conscious decision by the NSW State government to locate likely noxious industry in NSW, but away from Sydney – Port Kembla being selected for that purpose. Whether that were the case or not, ER&S, its associated industries, and other industry such as the steel plant, did make the town of Port Kembla an area of significant environmental disadvantage. Particularly after World War II there was growing community disquiet, developing to resentment, at the impact of emitting industries on their surrounding environment, and on community health.

Part of that resentment was directed at the State government, which emphasised ER&S’ employment role, and appeared to downplay health aspects of its emissions. In 2000, the government spent nearly five million dollars moving the local primary school away from its location at the base of the smelter stack to a more distant position. Rather than gaining plaudits from the public, that move simply raised issues concerning the houses which remained around the stack, for which government was providing no assistance.

Ultimately, it was that community response to the threat posed by a polluting industry which was to be the major contributor to the demise of the Port Kembla copper smelter.

A Troubled Life

At the start of its life, ER&S was owned by Mt Morgan (two thirds) and Aaron Hirsch und Sohne (one third). While this arrangement brought value in terms of technology and market access, it was to be short lived. It became problematic with the onset of World War I – under threats from the federal Attorney-General in 1915 to declare ER&S an enemy company, the company ownership was restructured to eliminate the German interest. The move also allowed ER&S to capitalise on wartime demand from British industry, providing an early boost to ER&S’ fortunes.

Reflecting the varying fortunes of the mining industry and firms over time, ownership of ER&S shifted a number of times over its working life. From losing its German partner in 1915, it became owned by Mt Morgan and a range of Australian investors including such copper miners as Mount Elliot, and Hampden Cloncurry mines. In 1927, Mt Morgan itself succumbed to low international copper prices and difficult mining conditions, and became bankrupt, their ER&S shares being acquired by Broken Hill Associated Smelters (BHAS).

Mt Morgan had been a major supplier of blister copper to ER&S, as well as part owner. Its loss was but one of the supply problems which ER&S faced over the years.

By 1947 the two principal owners of the company were Broken Hill South Ltd (BHS, at 60%) and North Broken Hill Ltd (NBH) who attempted to address ore supply problems by commencing mine developments in NSW and South Australia. The NSW mine (at Cobar) turned out to be problematic in operation, leaving an ongoing supply issue. BHS and NBH were in their turn both taken over by Conzinc RioTinto Australia (CRA) in 1980, CRA taking over also the Cobar mine. ER&S became a part of Australian Mining and Smelting, a division of CRA.

CRA for its part sought other equity partners in ERS, and took on two Japanese minority shareholders (Furukawa and Nissho-Iwai) at 30% and 10% holdings respectively. The ER&S name was also to disappear as a result, Southern Copper appearing as the operating entity in 1990. CRA also initiated substantial capital expenditure on the plant, of the order of $M150, including the installation of new technology such as a Noranda reactor. These corporate and technical initiatives however were not enough to overcome issues of market competitiveness and ore supply, and persistent environmental problems, and in 1995 Southern Copper shut down. Effectively it closed because it could not compete. Its premier role in Australian copper production had long since been taken over by a rival (Mt Isa Mines’ plant at Townsville), by then generating three times the output of ER&S. The story of ER&S appeared to have finished.

But there was yet another chapter – the final. CRA after closure of the plant had bought out its minority partners, to become the sole shareholder. The overall operation was then offered for sale, and was bought in 1997 by the former minority shareholders (Furukawa and Nissho-Iwai) in association with two other Japanese firms (Nittetsu and ITOCHU). The new company (now Port Kembla Copper) embarked on a major plant upgrade reported to have cost between $600 million and $800 million, and reopened it in 1999. The project was undertaken amidst much contention over employment, and environmental issues. Government inquiries suggested the upgraded plant would not be an environmental problem, but opposition persisted, reinforced by malfunctions at the new plant. A legal challenge to government approval was developed, only to be precluded by a new Act of Parliament introduced solely for that purpose. With ongoing breaches on licence environmental conditions, however, the new owners concluded it was not possible to operate in a manner compliant with the specified environment limits. The plant was eventually shut down for the last time in July 2003.

The Stack

Arguably the final page belongs to the demolition of the smelter stack which had dominated Port Kembla and surrounding parts of the Illawarra for fifty years. The stack, built in 1965 to limit ground level sulphur dioxide concentrations to acceptable values, was 650 feet (197m) in height above ground level, with an internal diameter of 14 feet (4.25m), a base external diameter of 52 ft 1 inch (15.75m) and a top external diameter of 21 ft 6 inches (6.5m). It was an imposing structure.

On February 20, 2014, the stack was demolished with explosives, a wedge being blown out of the base to fell the structure in a prepared location. Thousands watched from various vantage points (and many more on television) as the most visible remnant of a long and chequered history of copper production at Port Kembla fell in a cloud of dust.  A video of the fall may be seen here

Ref (1)  https://commons.wikimedia.org/wiki/File%3APort_Kembla_stack_demolition.jpg