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New Sparrows Point owners suggest (once again) most of mill will be scrapped

Only the cold mill has realistic chance to reopen. Owners don't address fate of 1,600 laid-off workers.

Chicago liquidator Hilco Trading and St. Louis property redeveloper Environmental Liability Transfer announced today the completion of their $72.5 million purchase of the Sparrows Point steel mill – and strongly suggested that only a sliver of the present mill will ever be used for steel manufacturing.

Today’s sale marks both the end of RG Steel Sparrows Point as an active facility (in reality, steelmaking was suspended last June) and as a union shop controlled by the United Steelworkers union (USW).

Beginning tomorrow, the new owners will have a free hand to dispose of the mill’s assets – and 3,400-acres of prime land along the outer Baltimore harbor.

Fate of Laid-off Workforce Unanswered

In their release today, Hilco and ELT offered few concrete details of their intentions.

But reading between the lines – and fully in keeping with prior filings in the bankruptcy case – the group gave little hope that the integrated mill would be reopened and employees reinstated.

Significantly, the laid-off force of 1,600 workers and their union were not even mentioned in the release. The Brew previously reported that the Hilco-ELT group went to great lengths in its purchase agreement with RG Steel to disavow any collective bargaining agreement or obligation to RG employees after the sale was completed.

Today’s release strongly suggested that the Hilco-ELT group will attempt to sell the cold-mill unit – which it described as “self-contained” even though it is connected to the mill’s steam and other infrastructure – and scrap the rest of the plant.

In terms of employment and output, the cold mill consists of about 15% of the total facility. It is the final step of a lengthy steelmaking and fabricating process that begins at the iron-producing blast furnace.

In order to operate independently, the cold mill would have to use semi-finished “hot-bands” obtained from other mills or from overseas.

Structural Demolition

ELT, a company that specializes in environmental remediation of former factory sites, purchased the cold mill mill and associated warehouses, along with Sparrows Point’s land.

Hilco, an industrial liquidator, purchased the “above-grade improvement and machinery and equipment,” including the mammoth L blast furnace, basic oxygen furnaces, continuous casters, hot-strip mill, galvanizing and tinplate facilities.

While saying the group might entertain the sale of the mill “in its entirety,” today’s release added, “We are also considering removal and resale of industrial equipment and structural demolition, followed by environmental remediation of the site as a precursor to redevelopment.”

The group also indicated keen interest in finding ways to develop some of the land into a port facility.

The Maryland Port Administration had been negotiating with RG Steel for the sale of Coke Point as a site to contain harbor dredge.

New Facility for Port of Baltimore

But the MPA and Baltimore County Executive Kevin Kamenetz have recently been talking up the use of the mill’s deep-water port for super-sized ships that will soon be passing through an enlarged Panama Canal. The port is seeking to expand its facilities to meet these needs.

Citing those plans, the release said that Hilco and ELT are “committed to working with local and state leaders and will keep communications open over the coming months.”

The leadership of USW Local 9477 insists that it will find an operator for all or part of the Sparrows Point mill.

The first step, says union president Joe Rosel, is to talk to Hilco and ELT. Despite repeated vows to do that, the union has yet to meet with the new owners.

A union officer today said such a meeting with representatives of Hilco and ELT is scheduled for next week.

FULL TEXT OF HILCO-ELT RELEASE.

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  • 9477 UB HATER

    WHERE SHOULD I PICK UP MY NEW WORK BOOTS THAT I ORDERED 18 WEEKS AGO? RG OR THE UNION ARE YOU THERE? OH AND MY VACATION PAY WHERES THAT?

  • sp sc

    How will they go about filling those 200 or 300 position s ?

  • eafcraneman

    i would love too frontier operate mingo and get employees back too  work      anymore news on it DR boothe

    • guest

      they are talking about selling the eaf to mexicans.

  • 9477 BLOWS

    WHEN IS THE BULL ROAST CRAB FEAST  AT OUR GREAT UNION HALL 9477 THE DUMP CUZ WE WANT TO SEE OUR REPS THAT ARE WORKING SO HARD TO GET US BACK TO WORK   LMAO THOSE LOSERS THEY NEED TO GTFO AND LOOK FOR A JOB NOBODY WILL HIRE THOSE LOSERS REPS DUMB SMOKES YOUR TIME IS REAL CLOSE TIC TIC TIC AND THE CHECKS STOP LMFAO  YOU POS CANT WAIT

  • bossdave

    msc employees, cant take 4 hr.lunch anymore, thats bullshit! HELP! UNION REPS TO THE RESCUE.

    • guest222

       Sorry;a 4 hour lunch break could only be the boss’s failure to do HIS job!!!! 

      • bossdave

        he tried, he couldnt move them with a prybar! please help us union reps! pronto.

    • guest222

      Well They’re only pushing 17 ovens…….. I mean, how bad can that be; REALLY?????

      • Guest

        thats nothing compared to the coke ovens in china, better and cheaper coke.

        • guest000

          Your reply to observer has no bearing on observer’s comment…. Regarding your comment why is the Chinese coke   better??, and I’m sure after transport costs ,its not cheaper.

          • steeler

            chinese coke is half the price but it takes twice as much because of poor quality  (moisture content,stability)

          • guest000

            Exactly; so in reality its NOT better!!!!  

          • Walter

            Chinese and Polish Coke do not deserve this bad rap from you Deer Hunters  They told me everything at WalMart and the Dollar Store is transported all the way from China and still the prices are better than if they came from the same city as your local WalMart and Dollar Store and things still only cost a dollar!  So transportation cost is not such a big factor when you are shipping this much bulk coke. Coke is light as a feather compared to transporting ore. 

            As to Chinese coke not being as good as domestic or Polish coke, this is simply not true. You give the specs you desire for your coke and the Chinese will deliver it to you. We at Sparrows Point, from time to time, had to deal with low quality American made Hillbilly coke. The only difference between Chinese and Hillbilly coke is the price. Even though SP has direct rail lines (old B&O right of ways) into Hillbillyville), they cannot give us a competitive price. WHY???? So do not let a few bad apple spoil your pie.  Demand higher grade coke or tell them you will buy elsewhere and they will fall all over themselves to get you the high quality you need.  For example, we NEVER had a problem with the Polish coke at SP.

            Sparrows Point needs to make its own coke again and then we can cut out the foreigners and Hillbillys just like it was before 1991 when the Beth Steel jerks closed down our Koppers Ovens. Even the tree huggers in Maryland were not opposed to the 200 mini-coke ovens that Little Alexie and Sun Energy were planning to build at SP, because it is a green way to generate electricity and the steel company gets the coke for almost free after selling all of the electric to the grid.

            Sun and its followers are the future of coke production, and the old dinosaurs that we see to the West of SP are about as relevant as a Conestoga wagon LOL!

            Dr. Walter       Phd. BS  

          • BOF man

            Walter; maybe you havent noticed but the ‘hilbilly’ cokeplant At MSC (severstal) is STILL operating!!!!!!!!!!   

          • Dr Raymond Boothe

            Walter you are totally off-base when you talk about coke. Chinese coke is probably the worst that is made in the word. It is about 50% dirt to begin with.
            They beg for coal exports from the United States because the United States has the best metallurgical coal on earth to make coke. The United States is far better in quality and stability than coke from China or Poland. Polish coke is decent, but not up to the quality of coke made at Follansbee or Ironton, Ohio (Sun). In fact Chinese coke would destroy most blast furnaces in the United States-it is simply trash. Hillbillyville makes some of the best coke on earth.

            Sun will never build a coke plant on Sparrows Point-they are too many EPA requirements in Maryland and there is no place at SP to build it where there are not a whole truckload of ecological problems.

            You are BS, Phd. concerning coke Walter. These “Hillbilly coke makers” have been making quality coke for nearly 200 years. Their quality coke is sold to plants that are operating and not ones that are rusting away.

  • SP

    AND ALL THEIVES PLEASE GET THERE EARLY. THANKS

  • observer

    What’s going on with Mingo Doc… Any news?. Or how about the old block; are there still negotiations with severstahl?????

    • bossdave

      no im on vacation now.

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