Opposition leaders say job cuts at the Tiwai Point smelter are a warning shot across the bows of Meridian Energy and the Government that its owner is serious about its desire to renegotiate its power contract.
Smelter owner NZ Aluminium Smelters (NZAS), which is 79.4 per cent owned by mining multinational Rio Tinto, yesterday said it was accelerating plans to axe 100 jobs from the Bluff plant in the face of depressed global metal prices. The jobs were to go over five years but that will now happen by November.
As the consumer of around one-seventh of all electricity generated in New Zealand, NZAS also wants to renegotiate terms of a 27-year contract with Meridian Energy, which is due to take effect from next year.
Labour leader David Shearer said the job cuts would be seen as making it "very clear that they want to renegotiate their electricity contract given that's by far the biggest expense they have".
"Given the smelter plays such a huge role in both exports and in the economy of the South Island, I would have thought they're playing hardball here."