Yesterday, Australian Prime Minister Julia Gillard announced that the Government would reveal the details of its decisive carbon pricing scheme this Sunday. Parliament will then start debating the package mid-August, after the five week winter break from parliament.
Nyrstar’s operations in Australia consists of the Hobart zinc smelter (annual capacity of approximately 260kt of zinc) and Port Pirie multi-metal smelter and refinery (annual capacity of 235kt of lead, 16m troy ounces of refined silver and approximately 45kt of zinc).
In our scenario, we are currently forecasting an increase in EBITDA from € 207m last year to € 325m. Of this estimate, € 35.6m or 11% is coming from Hobart and Port Pirie.
Given that the details of the carbon tax scheme are yet to be announced, it is too early at this stage to assess the impact, if any, on Nyrstar. In addition, it is very likely that we will see exemption schemes for energy intensive industries, such as zinc and lead smelting, which should limit the impact for Nyrstar.