CFAC a boneyard for Sebree?

A Midwest aluminum smelter that was prominent news in Columbia Falls 40 years ago is back in the news today. And a possible pattern is emerging — a giant parent company favoring one plant over another.

One week after the Anaconda Company announced plans in July 1970 to spend more than $100 million building a new smelter in Sebree, Ky., the Hungry Horse News published an editorial expressing concern about the future of the Anaconda Aluminum Co. smelter in Columbia Falls.

Alcoa was hired to build the Sebree smelter for Anaconda using cutting-edge smelting equipment, and dozens of experienced aluminum workers left the Flathead to help get the new plant up and running.

What concerned Hungry Horse News publisher Mel Ruder was whether Anaconda, the fourth largest aluminum producer in the U.S. and a global mining giant, was abandoning its Columbia Falls plant near the Continental Divide for a brand new one located on a barge-served river in Kentucky.

Specifically, Ruder wanted to know why modern pre-bake reduction cells were not installed at the Columbia Falls plant when it expanded from four to 10 pot rooms in the late 1960s, and whether Anaconda intended to purchase the necessary equipment to fix the local plant’s serious air pollution problem.

As it turned out, the expensive and necessary changes were made at the Columbia Falls plant to meet the state’s air pollution standards, and the smelter ran successfully at least until 2001, when energy costs and market prices forced cutbacks and eventually a complete shutdown.

But now the Columbia Falls Aluminum Co.’s owner, global trading giant Glencore, which recently merged with global mining giant Xstrata, has acquired a major interest in the Sebree plant through its holding company, Century Aluminum Co. Century paid Rio Tinto Alcan, Sebree’s fourth owner, $61 million for the Kentucky smelter, which is about 20 percent larger than CFAC.

According to the Century Aluminum corporate Web site, the company was created in 1995 as a holding company for Glencore’s aluminum producing assets. Those assets include the Ravenswood, W.Va., Mt. Holly, S.C., Hawesville, Ky., CFAC and Sebree smelters in the U.S. and a smelter in Iceland. Three members of Century’s board of directors are high-ranking Glencore executives.

The significance of the Sebree acquisition struck home this past week with talk about four to six Sebree employees scheduled to visit the CFAC plant on Monday, Dec. 9. According to sources, they were flying here to look over equipment that could be sold or transferred to Sebree — generic industrial equipment that could be vital to CFAC’s operation and difficult to replace.

The CFAC plant has barely run since it completely shut down in January 2001. The four pot rooms in the original West Plant are completely gutted, and many of the anodes in East Plant were damaged when incorrect carbon-paste briquettes were used. But a small crew of maintenance workers have worked hard to keep the plant ready for the day energy, raw material and metal prices justify an expensive re-start.

Publicly, Glencore has claimed a serious interest in CFAC ever since it acquired the plant in May 1999. That’s when senior trader Simon Trinca told media, “We view this as a long-term investment, with all that implies.”

This past year, Glencore representatives met with city and county officials who were concerned about CFAC’s future and growing talk about an EPA investigation and eventual Superfund-like cleanup.

Matt Lucke, Glencore’s senior aluminum trader in the U.S., called the idea of generating jobs through a big cleanup “short-sighted.” Lucke, who CFAC sources say championed the local smelter, left Glencore this summer to open a small trading business in Switzerland.

CFAC’s future is clouded by more than bad market prices. Old-fashioned technology, worn-out equipment and expensive cleanup liabilities make the plant unattractive to buyers.

While monitoring wells indicate waste dumped at the plant may not be contaminating groundwater that leaves the plant, a cleanup must address about 92,000 tons of spent potliner dumped with other waste in the plant’s landfills until 1985. That’s on top of the cleanup costs for the rest of the plant — which may be contaminated with asbestos fibers, coke and coal tar pitch particulates, and other hazardous chemicals.