UK Steel condemns BP choice of Chinese steel for Net Zero Teesside Project

UK Steel has today responded to reports that a contract for around 7,000 tonnes of steel for the Net Zero Teesside project worth approximately £5 million has been awarded to a Chinese supplier, despite the project receiving substantial taxpayer backing and support as part of the UK’s major decarbonisation programme. Net Zero Teesside is among the UK’s highest-profile clean energy infrastructure initiatives, designed to deliver a world-first large-scale gas-fired power station with carbon capture and storage, backed by the Government and supporting thousands of jobs and investment in the Teesside region. 

This development has sparked deep concern across the UK steel supply-chain, illustrating a broader challenge in ensuring that publicly supported clean energy infrastructure delivers maximum benefit to the UK economy and UK steel industry. 

Gareth Stace, Director-General of UK Steel, said: “BP’s decision to buy 7,000 tonnes of Chinese steel, worth around £5 million for the Net Zero Teesside project, rather than sourcing it from British Steel just miles away, beggars belief. For a major, taxpayer-supported project, this is deeply disappointing and should never have been allowed to happen.  

"The Government has been clear about its ambition to back British industry, strengthen domestic supply chains and treat steel as a strategic national asset. UK Steel strongly supports that direction of travel, which makes BP’s decision all the harder to understand. UK producers, including British Steel in the region, have both the capability and capacity to supply this steel.   

"Where projects benefit from public support, including through mechanisms such as Contracts for Difference funded by consumers and taxpayers, sponsors must be expected to align with Government policy in practice, not just in principle. 

 "This decision underlines why clearer expectations and firmer delivery are needed, so companies benefiting from public support cannot continue to offshore value, jobs and strategic capability when UK supply is available.”. 

UK Steel welcomes Government policy direction and its stated commitment to economic resilience, supply-chain security and industrial strategy for steel, but project sponsors must apply these intentions consistently across all publicly backed projects. 

Only with clear procurement expectations and enforcement can the UK capture the full industrial and economic benefits of its net zero ambition. UK Steel stands ready to work with Government, developers and project partners to ensure future procurement choices support British steelmakers and the thousands of jobs that depend on them.