Bluescope Steel (ASX: BSL) will apply for a $100 million assistance from the Australian government's Steel Transformation Plan, which accepted Monday applications from eligible companies for competitiveness assistance advances.

Prime Minister Julia Gillard announced in August the STP initiative to strengthen the country's steel industry.

"We believe the federal government's Steel Transformation Plan is tangible evidence of the importance the government places on having a viable, competitive and innovative domestic steel industry in this country," Bluescope Managing Director and Chief Executive Officer Paul O'Malley said.

The STP advance and Bluescope's capital raising, potential asset realization opportunities and restructuring of its Australian operations will help bring back the company to profitability and growth. O'Malley said the company is confidence it will meet the government's eligibility criteria and will work closely with the federal government to get approval.

For the 2011 financial year, Bluescope Steel suffered a $1 billion loss due to cheap competition from Chinese steelmakers.

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