Horsehead Corporation Announces Location for New State-of-the-Art Zinc and Diversified Metals Production Facility
Pittsburgh, PA, September 19, 2011 - Horsehead Corporation, a wholly-owned subsidiary of Horsehead Holding Corp. (Nasdaq: ZINC) today announced that it plans to build its new, state-of-the-art zinc and diversified metals production facility in Rutherford County, NC, near the municipality of Forest City. The new plant is expected to employ approximately 250 people once it is fully operational.
Horsehead President and CEO Jim Hensler said, "We are excited to begin the project and are pleased with the support we have received in North Carolina at the state and local level. We look forward to becoming an important part of the local economy, providing construction jobs over the next two years and manufacturing jobs thereafter. This facility will produce zinc at much lower costs and provide opportunities for the Company not only to serve its traditional hot-dip-galvanizing market, but also to serve the broader market for special high-grade zinc and the continuous galvanizing market as well."
Commenting on the numerous benefits the Company expects to realize, Hensler said, "We expect to increase operating efficiencies significantly while enhancing Horsehead's position as a globally competitive zinc producer and metals recycler. As a result, we hope to open new zinc markets with significant growth potential while further promoting the principles of sustainable development and product stewardship currently embodied in the Company's operations."
Before the final decision was made to locate the plant in Rutherford County, Horsehead considered numerous potential sites in multiple states. Some of the criteria for site selection included electric power costs, logistics and the incentives provided by state and local government. Horsehead's Monaca, PA location was one of the sites considered.
Horsehead has started the process of submitting environmental permit applications. Clearing and grading of the site will commence shortly. Construction of the facility could be completed as early as the third quarter of 2013. The existing smelter in Monaca, PA will continue to operate until the new plant is fully commissioned. Horsehead plans to continue non-smelter operations in Monaca and is exploring alternative uses for the facility.
About the New Facility
Horsehead anticipates capital costs for the new plant to be more than $350 million, and that the annual incremental EBITDA contribution from the new plant will be approximately $90 to $110 million, the majority of which will not be dependent on the price of zinc.
The new facility will utilize a lower-cost, environmentally friendly solvent extraction and electrowinning technology to selectively remove and refine valuable metals from electric arc furnace-based feed and other recycled materials into special high-grade zinc and other metal concentrates containing silver, copper and lead.
Solvent extraction is the only proven technology which selectively extracts zinc from a solution containing the multiple constituents typical of Horsehead's recycled feedstock. Electrowinning is the most commonly used technology in the world for producing high-purity zinc.
The new plant will be capable of producing special high-grade (SHG) zinc and continuous-galvanizing grade (CGG) in addition to the Prime Western (PW) grade that the Company currently produces.
Horsehead estimates the new plant's nominal operating level to be in excess of 150,000 tons per year of zinc. The new zinc plant will eventually replace the existing 140,000 tons per year smelter in Monaca, PA, and will be fed with waelz oxide from the Company's EAF dust recycling plants and galvanizer skimmings.
Expected environmental advantages of the new Horsehead facility include low air and greenhouse gas emissions, and a reduction of Horsehead's direct consumption of non-renewable energy sources including coal, coke and natural gas.
Horsehead Holding Corp. ("Horsehead") (Nasdaq: ZINC) is the parent company of Horsehead Corporation, a leading U.S. producer of specialty zinc and zinc-based products and a leading recycler of electric arc furnace dust, and The International Metals Reclamation Company ("INMETCO"), a leading recycler of metals-bearing wastes and a leading processor of nickel-cadmium (NiCd) batteries in North America. Horsehead, headquartered in Pittsburgh, PA, employs approximately 1,100 people and has seven facilities throughout the U.S. Visit http://www.horsehead.net/ for more information.
Cautionary Statement about Forward-Looking Statements
This press release contains forward-looking statements, including statements about business outlook, proposed initiatives and strategy and statements about historical results that may suggest trends for our business. These statements are based on assumptions, estimates and information available to us at the time of this press release and are not guarantees of future performance. There may be several factors that may cause our actual results to differ materially from the forward-looking statements, including, among others, the impact of future market conditions on our results of operations and our expansion plans and initiatives, our ability to achieve the cost savings and other benefits we expect to achieve once the new zinc plant is fully operational, the ultimate cost to construct the new plant and our ability to secure any additional required financing for it on acceptable terms or at all, our ability to obtain environmental and regulatory permits and approvals, and the success and timing of our expansion plans and initiatives and their impact on our future capabilities, capacity and production costs. Our actual results, performance or achievements could differ materially from those expressed in, or implied by, the forward-looking statements. We can give no assurances that any of the events anticipated by the forward-looking statements will occur or, if any of them does, what impact they will have on our results of operations and financial condition. You should carefully read the factors described in the "Risk Factors" section of our filings with the Securities and Exchange Commission for a description of certain risks that could, among other things, cause our actual results to differ from these forward-looking statements. All forward-looking statements are qualified in their entirety by this cautionary statement, and we undertake no obligation to revise or update this earnings release to reflect events or circumstances after the date hereof.