At a recent SunCoke Community Advisory Panel meeting in Middletown, McCoy said negotiating coke contracts will become even more important, not just due to demand, but also because of possible repairs that may need to be made to the company’s coking operations in Ashland.
According to the company’s 10-Q filing with the U.S. Securities and Exchange Commission, the Ashland Works plant received Notices of Violation in July 2007 and December 2008 in connection with the coke plant there involving pushing and combustion stack limits.
AK is working with the Environmental Protection Agency in an attempt to resolve the issues; however, the company said it cannot “reliably estimate the costs, if any, associated with any potentially required operational changes at the batteries.” Costs could be in excess of $50 million over several years, the filing said.
“That could make producing coke from that battery not economically feasible,” McCoy said.
The steelmaker receives about 1.8 million tons of coke annually from what is produced at the Middletown and Ashland coke batteries and what AK purchases from SunCoke’s Haverhill facility in Franklin Furnace, Ohio. McCoy said the company needs between 1.6 million and 2.2 million tons, depending on the market.
“(Ashland’s future) is uncertain at this point, and it’s just a calculation for why we need coke,” McCoy said.
As for the future of Middletown’s coke plant, McCoy said AK still needs its product.
“I will tell you the Middletown plant — I play guitar — it’s like a Fender Stratocaster: it’s old, but it still works great,” he said.
SunCoke is expected to begin producing coke in September 2011. Company officials said it will take up to four months for the plant to begin producing at capacity.
Contact this reporter at (513) 705-2843 or jheffner@coxohio.com.
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