NEW YORK A new
$1.1-billion steel project spearheaded by industry veteran John
D. Correnti is planned in Arkansas to serve the automotive, oil
and gas, and electrical energy industries.
The project in Osceola led by
Correntis new venture, Big River Steel LLC, was announced
Jan. 29 by Arkansas Gov. Mike Beebe in Little Rock. Correnti,
the former vice chairman, president and chief executive officer
of Charlotte, N.C.-based steelmaker Nucor Corp., filed for
incorporation Jan. 25, records show.
While it was not immediately
clear what products the mill will make, a spokeswoman for the
Mississippi County Economic Development agency said the
facility will make electrical steelsboth grain-oriented
and non-grain-orientedfor transformers, as well as coiled
steel for pipe.
"Having lived in Arkansas for
over 20 years and having been involved in building and
operating two other world-class steel mills in the state, I
know first-hand that the quality of the work force in Arkansas
is outstanding and well-suited for the high-paying jobs we
intend to create," Correnti said in a statement.
"Arkansas geographic location in the heart of the markets
we intend to serve, the states well-developed
transportation infrastructure, as well as the availability of
reliable electrical power and the can-do attitude
of government officials in Little Rock, Mississippi County and
Osceola, make Arkansas a great place for Big River Steel to
make its investment."
Beebe said the project could
create up to 2,000 construction jobs and 525 permanent jobs, as
well as act as a catalyst for job creation, investment and new
economic development beyond the facility. Construction of the
mill will take some 20 months from its groundbreaking, which is
expected later this year.
The plan is contingent upon the
state legislature authorizing the issuance of $125 million in
general obligation bonds under Amendment 82, which allows the
legislature to approve up to 5 percent of Arkansas
general revenue budget for bonding of "superprojects."
According to local news reports, it is the first time Amendment
82 has been triggered since its adoption in 2004.
The money generated by the sale
of the bonds would provide a $50-million loan to the company,
$50 million for site preparation, $20 million associated with
piling and subsurface stabilization, and $5 million for bond
Charles Bradford, president of
New York-based Bradford Research Inc., said the electrical
steel business has been difficult in recent years due to
oversupply and increasing global capacity.
"It hasnt been a good
market (domestically) for electrical steel. Worse than that,
there have been huge expansions outside of the U.S.," he said.
"Domestic companies were already exporting a substantial
portion of their product, but the Chinese have expanded
production dramatically. The Koreans have done it; I think the
Russians have also done it. Theres more than enough
capacity here, and were losing on the export market."
As outlined by Amendment 82,
once the governor refers the project to the speaker of the
state House and the president pro tempore of the state
Senate, the legislature will have 20 working days to conduct
its own independent economic study. The legislation will then
head to committee, after which both houses of the state
legislature will vote on the project.
Correnti could not be reached
Lisa Gordon, Pittsburgh,
contributed to this story.