Storm adds to chaos at troubled Italy steel plant

Reuters News
Posted: Nov 28, 2012 6:29 AM

By Vincenzo Damiani and Stephen Jewkes

BARI, Italy/MILAN (Reuters) - A violent storm hit the troubled ILVA steel plant in southern Italy, injuring dozens and adding to disruption at the huge site, which is already caught in a widening pollution scandal that could cost billions.

The tornado rolled off the sea and hit the port city of Taranto on Wednesday, bringing down a chimney stack and damaging a warehouse and lighthouse at the factory's docks, the company said in a statement.

Around 20 workers were injured out of a total of 38 people hurt in Taranto and divers searched for a worker who was unaccounted for after a dockside crane collapsed. Three others on the crane were rescued.

The sudden storm, which television pictures showed filling the sky with a dark grey swirl of cloud that ripped across the harbor, was the latest blow to ILVA, which has become one of the most pressing issues confronting the government of Prime Minister Mario Monti.

Europe's largest steel plant had already stopped production and faces the threat of permanent closure after magistrates this week seized semi-finished material and steel in a corruption investigation linked to the environmental scandal.

The particle-laden fumes and airborne waste pumped out by the plant are blamed for abnormally high levels of cancer and respiratory diseases in the region. The company denies its operations are responsible.

Environment Minister Corrado Clini insisted on Wednesday that the government would save the plant, which employs some 20,000 people in a region of high unemployment, saying its closure would have devastating effects on the wider economy.

"Risking industrial production in the steel sector means creating a domino effect in economic and social terms," he told parliament in a speech.


Antonio Gozzi, the head of Italy's steel industry association Federacciai, said permanent closure would force companies to buy steel from abroad, costing the rest of Italian industry up to 5 billion euros ($6.5 billion) and sending a number of companies to the wall.

"The government must be aware of the importance of steel for Italian industry. The manufacturing sector lives because it can get steel in Italy. If it has to import, it will lose its competitive edge," he said.

Clini said cabinet would pass legislation to force a clean-up of the plant, where employs some 12,000 people and keeps another 8,000 ancillary staff in work.

He said earlier that he thought a solution would be reached in time for a meeting with company management on Thursday. He said he expects the cabinet to approve a decree putting previously agreed clean-up measures into law.

"We are trying to implement what we have already decided," Clini told Canale 5 television, a day before a meeting between Prime Minister Mario Monti, unions and company management to resolve the standoff.

The two-year, 3 billion euro clean-up program agreed last month to secure environmental clearance for the plant should be completed without interference, Clini said. He has been battling to save the plant, putting him at odds with Taranto prosecutors.

"Cleaning up the site, laying down how the clean-up has to be carried out and how the site has to be managed to ensure that environmental and health protection standards are met are up to the government," he said. "It's not up to magistrates."

Magistrates placed the plant's blast furnaces under special administration in July. The crisis heightened when they seized the plant's output earlier this week. That led ILVA to shut down the cold-rolling section that transforms raw steel into plates and tubes.

ILVA produced 8.5 million metric tons of steel in 2011, nearly 30 percent of Italy's total output, and concern has grown about the effect of a shutdown on the rest of Italian manufacturing. Workers at an ILVA processing plant near Genoa in northern Italy say the plant will last just four days without steel from the southern plant.

Judges have also ordered the arrest of seven people, including the chairman of the company which controls ILVA, on suspicion that they bribed officials to cover up the scale of the health and environmental damage.

($1=0.7746 euros)

(Writing By James Mackenzie; editing by Barry Moody and Mike Nesbit)