THE future of Llanwern steelworks is again in crisis - despite assurances from Corus that the plant is not in imminent danger of closure.

Later editions of yesterday's Argus reported that fears for the future of Llanwern's remaining 1,500 jobs were voiced after the Anglo-Dutch steelmaker said it may have to close for more plants to survive.

Corus spokesman for Wales, Simon Jenkins, denied that Llanwern was at risk of closing. He told the Argus that reports about Llanwern's future were nothing more than "idle speculation".

But the company does face a cash-flow crisis, which it says can only be solved by "significant further capacity reductions and concentration of operations onto fewer sites".

Corus' financial problems are caused by its supervisory board in the Netherlands blocking plans for the £543 million sale of two aluminium businesses - cash due to be ploughed into its UK steel operation.

Annual results will be unveiled on Friday, but Corus expects group operating losses to be £393 million.

"Of course we have to be open about the challenges that are facing Llanwern, but we have made promises to the workforce that there will be a viable business at the plant," said Mr Jenkins.

"We have to build on that promise and not react to the speculation we have been hearing over the past few days. One of the biggest problems for us at the moment is staff motivation and morale, and these reports are harming that. Once the results are published on Friday we will be in a better position to comment."

Alan Howarth, MP for Newport East, said: "Llanwern is a highly productive, world-class plant. It's been through hell and high water to achieve the competitiveness it has. "It's central and indispensable to the whole Corus operation."

Union leaders reacted with anger, demanding urgent talks and calling on senior managers at Corus to resign.

Michael Leahy, general secretary of Iron and Steel Trades Confederation, said the Llanwern plant was profitable, and should be protected.

"Llanwern has moved into the black," he said. "Production is going well and they are the most efficient steel producers in the world. The pound is strong, our exports are good, so there is no reason for Llanwern to be in danger."

Welsh Secretary Peter Hain, speaking after discussions with Dr Mark Carr, head of Corus' Welsh operation, said last night: "The picture is uncertain, but it remains a fact that in a difficult global market, steel production at Port Talbot is highly competitive, with Llanwern playing a key part in the whole operation.

"I am hopeful that Wales will be spared any major restructuring after the traumatic changes made in the past few years."

Sir Harry Jones, leader of Newport city council, said: "I have had serious concerns about Corus and the steel industry for some time, but at this time, with little information about the outcome, we will be doing everything we can to put pressure on Corus."

Councillor John Jenkins, Newport cabinet member for employment and development, and a former Llanwern worker, said: "I support the Argus 100 per cent in whatever pressure it can put on Corus to clarify their intentions. Llanwern has taken the brunt before and needs to be protected."

John Griffiths, AM for Newport East, said: "I hope that Llanwern emerges relatively unscathed from whatever cuts take place."