U.S. Steel picks Osceola; 900 jobs expected at mill

US Steel announced on Tuesday that Osceola will be the site of what it considers the most advanced steel plant in North America, a $ 3 billion project that Arkansas economics officials say will generate 900 direct and indirect jobs.

The city of nearly 7,000 people in northeast Arkansas was one of the three-state locations the Pittsburgh steelmaker was considering for the new mini-steel plant, which will include two electric arc furnaces that will have the capacity to produce 3 million tonnes of steel a year. They are much cleaner than traditional integrated coal-fired power plants.

The plant will also have an “endless casting and rolling line and advanced finishing capabilities,” the company said in a press release issued Tuesday afternoon by the Arkansas Economic Development Commission.

“This first use of endless casting and rolling technology in the United States brings significant improvements in energy, efficiency and capacity to business operations,” the company said.

Site selection is subject to a number of factors, including final agreements with key partners. Authorization of the project has started. US Steel said it plans to begin the first quarter of 2022, with project completion and full operation slated for 2024.

“With this location selected and the excavators ready, we are reshaping the future of the steel industry,” US Steel President and CEO David B. Burritt said in a prepared statement. “We had many competitive site options, but Osceola offers our customers unparalleled benefits.

The selection highlights the continued growth of Mississippi County as a steel producing region. The industry, which also includes Nucor Steel, employs 3,000 people directly in the county. Another 1,200 are employed by steel-related companies and suppliers, according to county economic development estimates.

“Mississippi County has emerged as a national leader in steel production, and US Steel’s decision to create the ‘steel mill of the future’ in this community continues to underscore why,” the Commerce Secretary said. Arkansas, Mike Preston, in release.

US Steel is a relatively new player in the region. He announced in 2019 that he was buying a 49.9% stake in the steel mill from Big River Steel for $ 700 million. This operation began production in 2015 when it opened a $ 1.3 billion “flexible factory” near Osceola that employs more than 500 people. About 15 months later, she announced plans for a $ 1.2 billion expansion.

US Steel announced in 2020 that it would pay $ 774 million to buy the remaining 51.1% of Big River Steel.

“When completed, the new sophisticated steelmaking plant, associated with Big River Steel, will form a 6.3 million tonne mega-plant capable of delivering many of the most advanced and durable steels in North America. North, ”US Steel said.

“The new … lines currently under construction at Big River Steel will further enhance US Steel’s ability to meet the pressing supply chain needs of customers to meet their own domestic manufacturing expansion.” “

The company cited amenities in Northeast Arkansas’ selection over other locations under consideration, which included sites in Alabama and, some say, Mississippi as well.

“The location provides abundant, increasingly renewable and clean energy from Entergy, a superior Class 1 rail service from BNSF [Burlington Northern Santa Fe] with connections to other railroads, Mississippi River docks, and interstate trucking access, ”US Steel said of Osceola and northeast Arkansas.

Tuesday’s announcement was also the culmination of years of work by state and local economic development officials.

“We are very happy and pleased with the announcement,” said Clif Chitwood, director of the Mississippi County Economic Development Commission. “It should be a huge sum for Mississippi County.”

Even with the perfect location, Chitwood and others said the recent legislative enactment of recycling tax credit legislation that would benefit US Steel was key.

His stint put Arkansas “in the driver’s seat and keeps us there,” Gov. Asa Hutchinson said last month after signing identical bills to change the recycling tax credit law.

One of the law’s sponsors, State Senator David Wallace, a Republican from Leachville, said the project created 700 jobs paying an average of $ 120,000 a year and 200 jobs paying an average of $ 60,000 a year .

Recycling the income tax credits allowed under the bill would cost the state an average of $ 11 million per year for 14 years and $ 8.8 million per year if the state redeems the credits from the bill. tax with a 20% discount, he said at the bill signing ceremony. .

“Because of the location, we should have won it and we won it,” Chitwood said. “But we could have lost him. The legislature did its part.”

Osceola is contributing $ 1 million and Mississippi County is contributing $ 5 million to reimburse US Steel for the cost of land for the project, Chitwood said.

The company has several thousand acres under option, but Chitwood said he was unsure which options the company chose to exercise.

In a statement, Hutchinson praised US Steel’s decision to locate the facility in Arkansas and, like Chitwood, credited the Legislature.

“The investment and the well-paying jobs that will result from this announcement will make a real difference in the lives of many families in Northeast Arkansas,” he said in the statement. “I am grateful for the support of the Legislature which has been essential in winning this expansion. Now, US Steel is an important part of our future and we look forward to continuing to be successful in the years to come.”

The top executive of US Steel said the plant will play a disproportionate role in the future success of the steel industry.

“Our country and our customers need a strong and resilient supply chain to meet consumer needs, and that starts with advanced and sustainable steels from US Steel,” said CEO Burritt. “Steel is essential to much of what the world builds, so the way we make our products directly contributes to a better, more sustainable world for all. This new facility will build that future. “

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