The Joint Regional Planning Panel will meet in Wollongong on Thursday to decide whether to approve a development application to demolish and replace the first of the stacks.

The application for the $3.5 million project was lodged with Wollongong City Council late in January.

The project comes after the completion of major upgrades at the steelworks in the past year including the $370 million No 5 blast furnace reline and $134 million sinter plant upgrade. BlueScope is anticipating that its two blast furnaces will operate at 100 per cent capacity throughout 2010 to keep up with demand.

A BlueScope spokesman said the worn, 85m-high No 1 stack would be the first replaced.

"The BOS (Basic Oxygen Steelmaking) stacks are an iconic part of any integrated steelworks," he said.

"The function of the stacks is to carry away and flare (burn off) the BOS 'off gas' produced during the blowing of oxygen into the liquid iron to produce steel."

Flare stacks No 1 and No 2 were installed in 1972, making them almost 40 years old. The third was installed in 1983.

A statement on environmental effects lodged with the council said the existing stacks were surrounded by a lattice-style cage and required constant maintenance.

The report said one stack would be replaced each year over the next three years, while the spokesman said the work would occur within five years.

Weather conditions make April to June most suitable for carrying out the work, and the spokesman said demolition of the first stack was planned to start in June.

"The task at hand is to replace the worn No 1 stack with one that is of a slightly different, more modern design which will provide better protection to corrosion with a better burner management system," he said.