Kaiser delays restart

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Spokane

Kaiser delays restart Mead smelter won't reopen in fall; workers told they'll be laid off

John Stucke - Staff writer

Kaiser Aluminum Corp. told Steelworkers on Thursday afternoon that the Mead smelter will not be restarted this fall.

"They just called us up in human resources and told us," said Dan Russell, president of Local Union No. 329. "They're going to delay the time of the restart and lay everyone back off on Sunday."

The smelter has been idled since last year when wildly fluctuating power prices gripped California and the Northwest.

Kaiser brought a few dozen workers back in early August, anticipating that the smelter might restart in October. That's when the company is scheduled to begin receiving electricity from the federal Bonneville Power Administration.

Sagging metal prices, expensive Bonneville electricity and market uncertainty, however, have clouded Kaiser's chances of profitably smelting aluminum.

Company spokespersons were unavailable for comment Thursday.

"The big driver was the low price of metal," said the union's Russell. "They told us that's the primary reason and that they'll re-evaluate it in the spring.

"For now, everyone is going back to layoffs."

Even though Northwest smelters are not running, the dropoff in aluminum supplies coincided with a broad economic slowdown that lessened demand. The result: low metal prices offer poor incentive to restart smelters.

Russell said about 30 Steelworkers will remain in the plant for maintenance and mothball work.

"This is it for at least the next six months unless something extraordinary happens," Russell said.

Reuters quoted Kaiser spokesman Scott Lamb on Thursday evening saying that Kaiser hasn't made any sort of determination on a possible restart.

"There are many, many factors we are looking at," Lamb was quoted as saying. "we're looking at the BPA contract, the continuing costs that we would incur if we continue to be curtailed, and then there is certainly a cost with the restart as well."

The remaining aluminum companies in the Northwest already struck deals with Bonneville to retune their federal power allocation in return for money to pay workers and offset some of the costs of sitting idle.

Kaiser did not.

http://www.spokesmanreview.com/news-story.asp?date=091401&ID=s1023303&cat=section.spokane

-- Martin Thompson (mthom1927@aol.com), September 15, 2001


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