Multinational dairy co-operative Fonterra plans to close its century-old Cororooke facility,near Colac in south-west Victoria,Australia,by June 2013 as it is too expensive to be upgraded.
The closure will be carried out in a phased manner and will put 130 jobs at risk.
Fonterra Ingredients Australia ingredients managing director Simon Bromell said that the co-operative has explored all alternative options to keep the site open but they were not commercially viable.
It is unlikely that the co-operative will be able to relocate all employees and there may be a number of redundancies,Bromell added.
The dairy co-operative plans to relocate many of its 130 employees to other facilities.The century-old factory's steam boilers still operate on coal briquettes,and its emissions were failing to meet the new stringent Environmental Protection Authority standards.
In addition,with the price of briquettes surging,the production costs have also increased-to process a tonne of milk into skimmed milk powder,the production cost is$45 a tonne more than at its other natural gas-powered facilities.
