A memorandum of understanding has been signed by both parties which sets out the scope for the multi-million pound deal.
Councillor George Dunning, who spent 30 years working in the Teesside steel industry, welcomed the prospect of the deal which would provide a considerable and much needed boost to the local economy.
Councillor Dunning said:
"This is fantastic news for not only those people who lost their jobs but for the Redcar & Cleveland area.
If everything goes ahead it has the potential to provide a double boost for the area following the recent announcement by Corus of a new £31.5m manufacturing plant in the area.
I can't wait for the terms of the sale agreement to be finalised and then we can truly celebrate restoring steelmaking to Teesside and the TCP plant.
Nothing will give me greater pleasure that to see the 'Save our Steel' flag lowered to the ground after it has been flying over Eston Town Hall for far too long."
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