Italian court confirms shutdown at large steelworks in blow to Meloni

ROME, Sept 11 (Reuters) - An Italian court on Friday upheld an order to shut down blast furnaces at the former Ilva works, a legal source said, in a blow to Prime Minister Giorgia Meloni's efforts to keep the country's largest steel plant operating while a buyer is sought.

The plant, a leading employer in the southern Italian city of Taranto, is widely regarded as strategically important for Italy's manufacturing sector, supplying steel to customers in industries ranging from construction to automotive production.

The Milan Court of Appeal rejected a request lodged by operator Acciaierie d'Italia against a previous ruling ordering the hot-end area to be shut down and remediated due to inadequate environmental safeguards to protect residents from pollution.

The ruling clouds the future of the sprawling plant, which has long been at the centre of disputes over environmental damage, public health, industrial policy and employment.

The site, which employs around 8,000 workers directly and supports a large network of contractors in a city of fewer than 200,000 people, is Italy's only integrated steelworks, producing steel from iron ore and coal through a blast-furnace process.

Acciaierie d'Italia has argued that shutting the hot-end facilities risks jeopardising steel production at the site and warned that, beyond a certain point, blast-furnace cooling procedures could make restarting operations impossible without extensive repairs.

The government, which is seeking investors for a company currently under extraordinary administration, is facing mounting pressure to find an alternative industrial solution less than a year before a national election.

Alfredo Mantovano, undersecretary to the Prime Minister's Office, told unions this week that the government did not rule out maintaining a public stake in the company.

Italy's steel industry needs a green future, based on electric arc furnaces powered by DRI (direct reduced iron), Mantovano said, adding that the government was ready to make use of available funding for DRI projects.

(Reporting by Giselda Vagnoni; Editing by Joe Bavier Editing by Keith Weir and Joe Bavier)