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The sudden demise of Southland aluminium recycling company Taha Asia Pacific happened the day after its recycling contract at the Tiwai Point aluminium smelter expired, it has been revealed.
Taha’s five year contract with smelter owner New Zealand Aluminium Smelters (NZAS) ended on Monday and the company went into liquidation on Tuesday at 8.55am.
Liquidator Rhys Cain, of Ernst and Young, said yesterday when Taha’s contract ended, "business stopped".
Asked if that resulted in the liquidation, he said it was "reasonable to assume that".
It is understood fewer than 20 people worked at the plant, built by Taha Asia Pacific and opened in 2011 at a cost of more than $5 million.
NZAS general manager Gretta Stephens said in a statement yesterday that by working with an external recruitment company, nearly all former Taha employees who wanted work at NZAS had been given temporary roles.
Under its contract, Taha took NZAS aluminium dross, extracted the aluminium for re-use in the smelter and processed the remainder into a product it called Ouvea Premix.
Asked why Taha’s contract was not renewed, she said it came down to "commercial decisions based on a number of factors".
"The company was invited to tender with other companies ... in March this year. At no stage during this process was Taha given an indication it would be awarded the contract. NZAS did offer Taha a short term extension (up to three months) but this offer was not accepted."
NZAS was in the process of finalising arrangements with the unnamed new provider.
Until the new provider was in place, NZAS would manage the collection of dross on site, she said.
Neither she nor Mr Cain would say whether the recycling plant was fixed in place or removable, or whether it could be sold or leased to another operator.
Ouvea Premix is classified as a hazardous material which can potentially pollute waterways.
However, with further processing, it can be made into mineral fertiliser.
Taha and its offshoot company, Taha Fertilizer Industries Ltd, have been storing tens of thousands of tonnes of Ouvea Premix in various locations, including part of the former Matarua paper mill, and recently commissioned a fertiliser factory near Invercargill.
Last year Taha and its most senior staff member at the time were fined for storing the premix without resource consent or in a dangerous manner.
Ms Stephens said now Taha Asia Pacific was in liquidation, the storage of the premix was the responsibility of Taha Fertilizer Industries or the liquidator. Taha Fertilizer Industries is not in liquidation.
Environment Southland initiated the prosecutions. Compliance manager Simon Mapp said yesterday the responsibility for safe storage of the premix now lay with the liquidators.
He said consent was given last year to store premix at three locations — at Mataura and two Invercargill central industrial area sites. He said premix was being stored at Mataura but he was not sure if it was still at the other sites.