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AK Steel to Invest $21 Million in Its Butler Plant

July 22, 2008

By Joe Napsha, The Pittsburgh Tribune-Review

Jul. 22–AK Steel Corp. said Monday it plans to invest $21 million more into its Butler plant to expand production capabilities for grain-oriented electrical steels that are in strong demand in both the United States and global markets.

The West Chester, Ohio-based steelmaker expects the project will be completed late next year. The capital investment includes installing production equipment to use AK Steel’s proprietary special annealing (heat treatment) technology, as well as upgrading a processing line at Butler.

“AK Steel continues to respond to strong customer demand for our grain-oriented electrical steels,” said James L. Wainscott, president and CEO. It’s the company’s fourth project in the past four years to increase production of electrical steels.”

AK Steel, which employs about 1,500 people at its Butler plant, does not anticipate adding to the work force, spokesman Alan McCoy said.

In addition to enhancing production capacity for higher quality grades of electrical steels, AK Steel said the project will help improve AK Steel’s product mix flexibility.

Grain-oriented electrical steels are used in the manufacturing of energy-efficient power generation and distribution transformers. The higher-value-added electrical steels are more efficient conductors of electricity and in greater demand, McCoy said.

AK Steel announced in October it is implementing a $180 million capital program to increase production at its Butler and Zanesville, Ohio plants. Most of that investment, which includes installing a more efficient electric arc furnace, is at the Butler plant, the company said.

Neither Hank Leyland, president of United Auto Workers Local 3303, which represents about 1,320 workers at the plant, nor Brian Cossitor, vice president of the union, could be reached for comment.

In addition to the investment at the Butler plant, other steel facilities in Western Pennsylvania have been upgraded or are targeted for capital investments.

U.S. Steel Corp. has said it is planning a $1.1 billion investment in coke oven batteries and repairing some of its older ones.

Allegheny Technologies Inc. recently completed a $60 million expansion at its Washington specialty steel plant and is considering the Brackenridge or Midlands plants as possible sites for a $400 million hot strip mill.

Latrobe Specialty Steel Co. is investing $62 million for an expanded vacuum induction melting and vacuum arc remelting operation at its Latrobe plant and expanding its Venango County facility.

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