There is a push for the area to become a key player in Tasmania's "circular economy", including waste recycling and energy projects, in addition to renewable hydrogen opportunities.

Woodside Energy and Countrywide Renewable Energy are one of seven renewable hydrogen projects vying for a grant from the Australian Renewable Energy Agency for a project at Bell Bay, while other companies have also proposed projects.

Read more: TEMCO sales gives Bell Bay certainty, but smelter will need millions in upgrades

George Town mayor Greg Kieser said it was his understanding that GFG Alliance - which has reached an agreement to buy the smelter from South32 - had provided an assurance that there would be no job losses as part of the transition.

Cr Kieser said the announcement meant the supply chain in the area remained in place.

"It does allow us to insulate the journey to next generation future industrial partners in the Bell Bay manufacturing zone because it provides continuity to the supply chain," he said.

"Hydrogen is one that we're working the closest with the minister, the Office of the Coordinator General and at a federal level.

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"In addition, there's a huge opportunity for the circular economy. We know that waste recycling and future energy is something that the state has a very large need for."

The binding agreement involves an entity within GFG Alliance - owned by billionaire Sanjeev Gupta - buying the TEMCO shareholding from South32's Groote Eylandt Mining Company.

It came after long-term discussions between South32, the Coordinator General and GFG Alliance.

Bell Bay Advanced Manufacturing Zone project officer Susie Bower said while it was important to retain the 250 jobs, the announcement also locked in more jobs in the region.

"The supply chain is very excited. Some of the contractors, some of the businesses I represent as part of the Bell Bay Advanced Manufacturing Zone are sighing a bit of a relief today as I'm sure every employee is in South32," she said.

"It shows the real confidence from Mr Gupta in the Tasmanian economy and shoring up our future and where we're actually heading."

Having transformed Whyalla's ageing steelworks into a green steel facility, GFG Alliance is turning its attention to Bell Bay's TEMCO manganese smelter.

The company has an ambition of being carbon neutral by 2030, with TEMCO's use of hydro power assisting in this ambition, Mr Gupta said in a statement.

Energy Minister Guy Barnett said the sale was an indication that Tasmania could capitalise on its status as a renewable energy powerhouse.

"The vision that GFG Alliance has for green steel backs in Tasmania's renewable energy credentials," he said.

"It's globally leading, it's been recognised by GFG Alliance and Sunjeev Gupta and we say 'thank you' for that."