While WV waits for action, Century Aluminum completes its acquis - WBOY.com: Clarksburg, Morgantown: News, Sports, Weather

WV waits for action, Century Aluminum completes its acquisition of Ky. smelter

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While West Virginia waits for news about its shuttered Century Aluminum plant, the company announced June 3 its wholly owned subsidiary has completed a transaction with Rio Tinto Alcan, Inc. to acquire substantially all of the assets of the Sebree aluminum smelter.

The Sebree smelter, located in Henderson County, Ky., employs more than 500 people and has an annual production capacity of 205,000 metric tons of primary aluminum, according to a news release from Century.

"We are really happy to welcome the men and women of Sebree to Century," Century Aluminum President and CEO Michael Bless said in a news release. "With the changes occurring in U.S. energy markets, we believe Sebree, along with our existing smelter at Hawesville, will be competitive in the global market.

"We see a great opportunity for these facilities, which are located about 60 miles apart, to work together and share best practices in pursuit of safety and operational excellence."

Bless said access to market-based power is a "critical enabler" for sustained operations at Hawesville and Sebree.

"We believe the framework reached with the power provider for market-priced energy for Hawesville will serve as a model for Sebree."

The terms of the Sebree agreement state that Century will acquire the smelter for $61 million in cash, after $4 million in purchase price deductions along with $71 million in working capital. RTA will retain all historical environmental liabilities of the Sebree smelter and has agreed to fully fund the pension plan being assumed by Century's subsidiary at closing.

Century closed its Jackson County plant in Ravenswood in 2009, and engaged in a lengthy special rate hearing with the Public Service Commission of West Virginia last year.

The PSC issued a ruling to outline the parameters under which Century could purchase electricity at a special rate, but Century has not yet moved forward.

The option of purchasing free market electricity was brought up during the rate hearing, after Bless said the company could make a profit by getting its electricity from the open market in West Virginia, but in its reply briefs in the rate case, the company said the process to adopt a deregulation plan was "daunting, as is the challenge of constructing a deregulation plan which satisfies the multiple stakeholders. Nowhere in its testimony did Century propose such an alternative."