The government will reportedly announce a £300 million funding package for the UK’s second-largest steel producer in a bid to help it survive and decarbonise its operations amid rising costs.

The package, first reported by Sky News, could help protect thousands of jobs and avoid a potentially larger cost caused by a potential collapse.

According to the report, the funding will be linked directly to green practices – more specifically, it is believed that the extra cash will help the steel giant to replace its blast furnaces with an electric arc furnace at its site in Scunthorpe.

A few months ago, the steel manufacturer reportedly asked the government for an urgent support package as energy costs soared.

A BEIS spokesperson told ELN: “The government recognises the vital role that steel plays within the UK economy, supporting local jobs and economic growth and is committed to securing a sustainable and competitive future for the UK steel sector.

“While we cannot comment on ongoing negotiations, the Business Secretary considers the success of the steel sector a priority and continues to work closely with industry to achieve this.”