Tens of local companies in Invercargill have been hit by the Tiwai Point aluminium smelter halting $70 million of projects today.
The projects relate to the replacement and upgrading of equipment which would extend the life of the smelter near Bluff and increase its production.
The ''capital'' spending halt is part of the effort to return the smelter to profitability. It has been hurt by falling international aluminium prices.
New Zealand Aluminium Smelters general manager Ryan Cavanagh said at least 100 of projects had been halted with the multi-million dollar ones being the replacement of cranes and transformers.
The smelter was still spending on areas critical to the business such as projects related to health, safety and the environment.
Smelter management is not revealing how much of the $70m is supplied by local companies. The suppliers were a mix of local, some national and international companies, Cavanagh said.
He said ''tens'' of local companies in Invercargill region were affected by the halt. The number was more than 10 and less than 50, he said.
''We working through all local impacted companies at this stage ,'' Cavanagh said.
''We are also reviewing all of our maintenance spending and we are working with our impacted stakeholders in that as well. That is ongoing.''
The spending halt did not largely affect the day to day running of the smelter operation. Some employees were involved in project work but the majority were employed in the operation.
The restructuring of the operation was examining every department and where savings could be made to bring the operation back to making money.
''NZAS is losing money,'' he said.
NZAS announced a couple of months ago that it planned to shed 100 jobs by the end of November, including 35 who have already gone.
- © Fairfax NZ News