South Australia’s Whyalla steelworks will lift production by 50 per cent to 1.5 million tonnes a year under a $1 billion transformation plan confirmed by its new owners.

British industrialist Sanjeev Gupta says his GFG Alliance has developed a comprehensive investment strategy for the former Arrium facilities that will improve its operational and financial performance and ensure its long-term sustainability.

The plan includes introducing new technology to the operations and cutting costs through energy efficiencies such as co-generation and energy capture.

The GFG Alliance will also explore development of the Whyalla Port into a world-scale, multi-user facility to support the steelworks and the company’s mining operations along with further economic development across Spencer Gulf.

“We strongly believe that the transformation will also provide a solid basis for our broader vision of making Whyalla a centre of manufacturing excellence,” Mr Gupta said in a statement on Friday.

“Through large investments in renewable energy and key infrastructure projects, we believe we can make Whyalla an attractive global hub for innovative, energy-intensive industry.”

SA Treasurer Tom Koutsantonis said the company’s investment plans confirmed Whyalla as the heart of its Australian operations.

“The biggest threat has always been carving off Whyalla from the rest of the operations,” he said.

“What we’ve got now is recognition from everybody that the old Arrium, the Whyalla steelworks, is the beating heart of the entire GFG Alliance operations in Australia.”

Whyalla Mayor Lyn Breuer said the expansion of the steelworks would transform the entire community.

“We are incredibly excited to hear of the progress made by the GFG Alliance during their 100-day review,” Ms Breuer said.

GFG officially took charge of the Whyalla steelworks and Arrium’s other assets around the country in September.

Following its review of the operations, it will continue with feasibility studies in 2018, funded by the South Australian government’s previous commitment of $50 million.