28 July, 2011
Noranda Aluminum Holding Corp. is considering spending as much as $100 million on expansions that could add incremental capacity at its flat-rolling operations and double rod output.
The company is reviewing a number of projects that will add incremental capacity or free up capacity in each of the company’s bottlenecks. The projects are still in the evaluation stage, and some might not come to fruition.
The company says the one idea is to spend roughly $30 million to adjust furnaces at its Huntingdon, Tenn., rolling facilities to process more scrap. It has two plants at Huntingdon – the West plant, with an annual capacity of 235 million pounds of foil and light-gauge sheet for the heating, ventilation and air conditioning (HVAC), semi-rigid container and automotive markets; and the East plant, with a capacity of about 132 million pounds per year of light sheet and foil from continuous cast coil for the HVAC, semi rigid container, and packaging markets.
Noranda, majority owned by private equity firm Apollo Management LLC and shipped 100 million pounds of flat-rolled products in the second quarter, is also considering refurbishing and reinstalling a mothballed flat-rolling mill.
The company bought the mill several years ago and is storing it disassembled at its Salisbury, N.C., site. The cost to refurbish this mill will be around $40 million, significantly lower than the $100 million to $120 million it would cost to purchase and install a new mill.
The third project would cost about $35 million, and involve purchasing and installing a third rod mill in New Madrid, Mo., where Noranda has an aluminum smelter that already feeds two other rod mills on site.
The smelter, which is in the process of being expanded, supplies part of its output to the rod mills, with the remainder going to third-party customers, according to the company’s Web site.
Noranda also is replacing a rectifier transformer at its New Madrid smelter and continues to expand its Saint Ann bauxite mine in Jamaica. These projects follow the company’s initial public offering in May last year, which raised $81.6 million.