AK Steel to Upgrade Specialty Steel Operations
10/23/2007 - AK Steel is planning capital investments including a new electric arc furnace, new ladle metallurgy furnace, and additional electrical steel finishing equipment at its specialty steel operations in Butler and Zanesville.
AK Steel’s board of directors has approved capital investments including a new electric arc furnace, new ladle metallurgy furnace, and additional electrical steel finishing equipment at its specialty steel operations in Butler, Pa., and Zanesville, Ohio.
The capital investments, which total $180 million, will provide AK Steel the flexibility to serve growing electrical steel demand, as well as the opportunity to increase carbon steel production at its Butler Works. The projects are expected to be completed by the end of 2009.
"Our grain-oriented electrical steels continue to be in high demand and short supply," said James L. Wainscott, Chairman, President and CEO of AK Steel. "The capital investments announced today will help serve the robust markets for new, highly efficient electrical transformers in the United States and elsewhere around the world."
According to AK Steel, increased demand for grain-oriented electrical steels has been driven by new, recently introduced electrical efficiency standards in the U.S., as well as aging electrical generation and transmission infrastructures in some regions of the world. AK Steel's grain-oriented electrical steel capacity will increase to approximately 344,000 tons annually upon completion of the electrical steel projects.
As part of the announced capital investment, AK will replace two of the Butler Works’ three existing EAFs with a one new higher-capacity EAF capable of melting more than 1.45 million tons annually—about 40% more than is currently produced with the current three-furnace operation.
AK Steel could use that additional capacity to produce approximately 400,000 tons of carbon steel slabs annually, if warranted by market conditions. The extra carbon capacity would help to boost the company's self sufficiency by substantially reducing its need to purchase merchant slabs. To provide additional manufacturing flexibility, one of the existing EAFs will be preserved.
The company will also install a new ladle metallurgy furnace at the Butler meltshop. The new LMF will help improve quality and productivity for all of Butler's melt capacity—electrical or carbon—by allowing additional chemistry and temperature refinements prior to continuous casting.
Finally, the company will also install additional annealing and coating equipment at both the Butler and Zanesville Works, which will allow it to increase its shipments of grain-oriented electrical steels.
The new electrical steel projects—new EAF, new ladle furnace, and additional finishing equipment—represent the fourth expansion of AK Steel's electrical steel capacity since 2004.
Headquartered in West Chester, Ohio, AK Steel produces flat-rolled carbon, stainless and electrical steel products, as well as carbon and stainless tubular steel products, for automotive, appliance, construction and manufacturing markets. AK Steel is one of the world’s largest producers of silicon-alloy electrical steels and is the leading domestic producer of the high value-added grain-oriented electrical grades, which are used in the manufacture of energy-efficient power generation and distribution transformers.
