Sustained high metals prices and growing demand for rebar have prompted a decision to reopen an idle steel mill near Kingman that in its heyday employed about 180 people.
Nucor Corp., one of the nation's largest steel producers, said it would invest approximately $30 million to restart the former North Star Steel Mill, which has been closed since March 2003. The company plans to have the 12-year-old mill back in production by the second quarter of 2009 and will initially employ about 50 people.
"It's absolutely good news and a big economic win for Mohave County," said Jonas Peterson, Mohave County's deputy director for economic development. "These are very high-paying jobs that will have a big economic impact on the area."
Nucor paid $35 million for the mill in 2003 but chose not to reopen it based on an economic assessment of the facility.
North Star Steel, a division of Cargill Inc., opened the plant in 1996 after investing an estimated $140 million in the facility.
Dan DiMicco, Nucor's chairman, CEO and president, said the decision to reopen was driven by higher prices and growing demand for rebar in the southwestern U.S.
The plant will have an annual production capacity of 500,000 tons.
Landing the mill and up to 250 relatively high-paying jobs in 1996 was initially touted as an economic development coup for Kingman.
But the plant, which recycled autos, appliances and scrap into rebar, was beset with financial and environmental problems and never reached full employment. When it closed in 2003, it laid off 113 employees.
Soaring electricity costs hammered the facility, which closed down its melt shop in 2000. The melt shop was the source of numerous air-quality violations and in 2001, the facility paid a $7.75 million civil fine. The state contended the company operated the plant from 1996 to 1998 without a proper air-quality permit and that on many occasions its emissions were in violation of standards.
Nucor does not plan to restart the melt shop and will instead ship raw steel to the plant to be reshaped.
"That way they can avoid all the pollution problems," Mohave County's Peterson said.