An MP has spoken of the “great anxiety” among steelworkers in Lincolnshire, who he said faced losing their jobs by Christmas.

Martin Vickers, Conservative MP for Brigg and Immingham, told MPs closing the blast furnaces in Scunthorpe would affect “many thousands of people and many businesses”.

As part of a £1.25bn decarbonisation plan announced in November, British Steel’s owner, Jingye, said it would close the plant’s two blast furnaces and replace them with a greener electric arc furnace.

However, a spokesperson said no decision had been made regarding the date for the shutdown of the furnaces.

Speaking in the Commons on Thursday, Mr Vickers said: “There have been widespread media reports suggesting that coke would stop being imported from October [and] that would mean production would be stopping in Scunthorpe by Christmas.

“There are rumours concerning the fact that employees will be given notice very soon,” he said.

“This is obviously creating great anxiety amongst those directly employed by British Steel, and also those in the supply chain which, particularly in northern Lincolnshire, extends to many thousands of people and many businesses,” he added.

In response, Labour industry minister Sarah Jones said the government planned to spend £2.5bn “to rebuild the steel industry”.

The money would sit alongside a separate £500m package for Tata Steel in Port Talbot, South Wales, to build an electric arc furnace to replace the existing coal-powered process.

Ms Jones said the previous administration had spent over a decade “lurching from crisis to crisis, with no clear plan to safeguard the future of a competitive domestic steel industry”.

“This government is determined to change that,” she said, adding “decarbonisation must not mean deindustrialisation”.

However, Conservative shadow business minister Greg Smith asked Ms Jones whether she had discussed electric arc furnaces with British Steel, and whether the firm would switch to foreign imports from China to fulfil its UK supply chain obligations.

In a statement, a British Steel spokesman said: “We are in ongoing discussions with the government about our decarbonisation plans and the future operations of our UK business.

“While progress continues, no final decisions have been made”.

North Lincolnshire Council granted British Steel planning permission for a new electric arc furnace in Scunthorpe last April.

Redcar and Cleveland Borough Council has also given the green light to plans for an electric arc furnace at the firm’s Teesside site, as part of its £1.25bn decarbonisation plan.

Speaking in November, British Steel chief executive Xijun Cao said: “Our desire to dramatically reduce our carbon footprint, coupled with current market conditions, means we can’t wait and need to transform our business as quickly as possible.

“And while decarbonisation will not happen overnight, it’s imperative we take swift and decisive action to ensure a sustainable future for British Steel.”

Listen to highlights from Lincolnshire on BBC Sounds, watch the latest episode of Look North or tell us about a story you think we should be covering here.