This massive plant has been noted on my Google Maps listing of abandonments.
Century Aluminum in danger of shutting down in 60 daysBy George Hohmann, Daily Mail, December 17, 2008 RAVENSWOOD, W.Va. -- Century Aluminum today told its 685 Ravenswood employees it is immediately shutting down one pot line and may shut down the entire plant in 60 days.
The company said the plant could be shut down "unless the London Metal Exchange selling price for aluminum stabilizes and the company is able to materially reduce costs and stem monthly losses."
The average salary at the plant is $50,700. The plant has a $34 million annual payroll. It is the third-largest employer in Jackson County, after Rio Tinto Alcan's rolling mill and the Board of Education.
Century said it "will be actively seeking cost reductions in power, alumina, coke, pitch, labor and other materials and services."
The company's labor contract with the United Steelworkers union expires May 1. Dave Patrick, president of Steelworkers Local 5668, was in an arbitration hearing this morning and not immediately available for comment.
The plant's power contract expires in July. Century has a unique contract with Appalachian Power. When the price of aluminum is high, Century pays Appalachian Power more than the utility's posted tariff for industrial customers. But when the price of aluminum is low, Century pays the utility less than the posted tariff.
Jeri Matheney, Appalachian spokeswoman, said today, "They are our largest customer in West Virginia so of course a shutdown would have an effect on our company. At this point our biggest concern is for the workers. We will be working with Century in any way we can."
The company said the shutdown of one pot line will be completed by Saturday. "If the London Metal Exchange price for aluminum does not stabilize and/or the company is unable to obtain the necessary monthly cost savings, the company will curtail 100 percent of smelter operations, beginning Feb. 15, 2009," the company said. Ravenswood Plant Manager Jim Chapman said in a prepared statement, "These are economic decisions based on the global economic crisis and the unprecedented decline in aluminum prices. We are experiencing significant losses at the current aluminum price. The pot line curtailment will allow us to immediately reduce our cash losses while we work diligently over the next 60 days with suppliers, customers, employees and government officials to explore all avenues for improving plant economics and maintaining operations."
Mike Dildine, Century's director of corporate communications, said Chapman met with Gov. Joe Manchin Tuesday to inform Manchin of the situation.
Matt Turner, spokesman for Gov. Joe Manchin, said today that the governor has been in touch with Century Aluminum leaders in order to assure them that the state offers whatever help it can.
"But there's only so much you can do in a market like this," Turner said. "It's obviously bad news. It's tough news to swallow."
Officials with the state Development Office and WorkForce West Virginia are preparing to go to the area to help with training and assisting any who lose their jobs find work elsewhere, Turner said.
State development officials have determined that Century's problems are directly linking with the downturn in the economy, especially in the aerospace and automobile sectors, which are Century's biggest customers, Turner said.
Ravenswood Mayor Lucy Harbert said if the plant shuts down, the community and county would be devastated.
"If Century Aluminum would shut the plant down, I doubt very seriously that it would ever reopen," Harbert said. "There are over 25,000 people in this county that this would affect."
Harbert called on Manchin and lawmakers to do whatever they can in order to help the plant stay open. She said in days when companies are getting billion-dollar bailouts from the government because of corporate "greed," she thinks the aluminum plant should get some help, too.
"A lot of young families have gotten jobs there and it would just be such a hardship on everyone and people are having it hard enough the way it is," Harbert said. "We need to give them all the help we can. I realize we might be being a little selfish, but, this little town, you might as well roll up the sidewalks."
The current price of aluminum on the London Metal Exchange is around $1,425 a metric ton, Dildine said. "If you go back to around July, the price was over $3,200 a metric ton," he said. "The price drop has accelerated into December, so what was a very worrisome situation in November turned into a critical situation for us in December."
Dildine said he isn't sure what the price of aluminum must be for the Ravenswood plant to be economically viable. "I can't speak for other plants; I can't even give your our own plants' cost structure," he said. "We are looking for a significant increase in the price of metal and aggressively seek every means possible to improve our own cost structure.
"Ravenswood is a relatively high-cost plant for the United States and of course U.S. smelters are high on the world cost curve as well," he said.
High energy costs have decimated the smelter industry in the United States. In 1974, there were 34 smelters in the United States. Only about 13 still operate today.
Century marked the 50th anniversary of its Ravenswood smelter in September 2007. It is Century's highest-cost plant and it is oldest aluminum smelter operating in the United States. Wayne Hale, Century's executive vice president and chief operating officer, said during last year's anniversary celebration that alumina accounts for 37 percent of the plant's costs, while electricity accounts for 26 percent, labor accounts for 16 percent, carbon accounts for 8 percent and other raw materials account for 12 percent.
Most of the aluminum produced at Ravenswood is used next door at Rio Tinto Alcan's rolling mill. The businesses were established as one unit in 1957, but split into two in 1999. Century has a contract to supply Rio Tinto Alcan through 2009. Asked who would supply the Rio Tinto Alcan mill if Century shuts down, Dildine said, "I can't speak for them. The hope is we'll be able to keep the plant in operation. If we can't do that, they would have that decision to make."
The Ravenswood plant's history includes a lot of labor strife. In August 2006, the Steelworkers union, which represents the plant's hourly workers, ratified a three-year contract after stormy negotiations. A strike was barely averted.
