Reuters reported that Century Aluminum Company has resumed talks for a power deal with Appalachian Power, a unit of American Electric Power Company to supply its Ravenswood, West Virginia aluminum smelter as it moves closer to restarting the idled plant.
The 170,000 tonne per year aluminum plant was shut in 2009 due to low demand for the metal and falling aluminum prices. AS the company moves forward with its plans to resume operations, its next steps are to negotiate an energy agreement and a labor contract with the local steelworkers union.
Century's spokeswoman said that so, those are the next two things that we're working toward in order to restart. On February 29th 2012, Monterey, California based Century announced that it struck a deal with the United Steelworkers union to restore healthcare benefits for retirees of the Ravenswood aluminum smelter as part of its move to restart operations.
The company spokeswoman said striking the deal on retiree healthcare was the first step in the process to restart. The plant will likely start up at less than full capacity, but the operating rate will depend on terms of the power and labor agreements, as well as the aluminum price.
She said that it's really those three things. So, we're working towards the two that we can have more impact on. Restarting Ravenswood would also depend on the aluminum price because that's necessary to have a profitably running facility.
Century needs a reasonable expectation that aluminum prices will be sufficient to cover costs and be profitable. That will be determined by the energy agreement and the labor contract.
West Virginia offered Century an inducement to restart the Ravenswood plant by passing a bill to give the company USD 20 million annual tax break. The aluminum producer plans to hire about 400 people to run the smelter. Once progress has been made on the power and labor deals the company will determine a timeline to restart operations.
Source - Reuters