Timet cancels plan to build sponge plant [UPDATE]

Nov 29, 2007 | 10:21 AM | Frank Haflich

Titanium Metals Corp. has put plans for a new sponge plant on the back burner as the outlook for raw material supply now appears sufficient to meet its needs.

Timet, which has been conducting design and engineering studies on a new front-end operation in an undetermined location, has decided "it is not necessary to commence construction of a new sponge facility at this time," Steven L. Watson, vice chairman and chief executive officer of the Dallas-based producer, said.

But Watson, noting that these studies have been completed, suggested that Timet is ready to proceed with a greenfield plant at some point in the future if conditions change.

"The completion of the detailed design and engineering for a new greenfield sponge facility, together with Timet's existing sponge production facility, sponge and scrap supply agreements and expanded scrap processing and melting initiatives under way, provides the company with additional alternatives and greater flexibility for its future raw material supply agreements," Watson said.

Timet's existing sponge facility is located in Henderson, Nev.

In late March, Timet disclosed that it had launched design and engineering efforts for a new plant that would produce 10,000 to 20,000 tonnes per year, or about 22 million to 44 million pounds. Timet never disclosed the projected cost of the facility nor its likely location, although industry sources estimated the final bill at $300 million to $500 million.....

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