Mill project could start in spring '11

| Saturday, Dec. 4, 2010

Allegheny Technologies Inc.'s planned $1.16 billion specialty metals hot rolling and processing plant and melt shop in Brackenridge -- in the works for more than three years -- finally could start this spring, according to a construction industry expert.

Allegheny Technologies has hired two members of the development team for the project, said Jeff Burd, president of Tall Timber Group in Ross, which publishes BreakingGround magazine, which tracks the Western Pennsylvania construction industry.

Siemens VAI Metals Technologies had previously been announced by ATI as designing the mill equipment. Dan Greenfield, spokesman for ATI, would not confirm other members of the team.

Burd said he understands Walbridge East LLC of Pittsburgh will act as construction manager. Spokesmen for Walbridge and Siemens could not be reached. Hatch Ltd. of Mississauga, Ontario, had been the engineer on the project but is not currently involved, a spokesman said.

Greenfield confirmed that construction will begin in 2011, but he would not confirm it would begin in the spring.

"Land has been cleared and site preparation work has started on the site," he said.

CEO L. Patrick Hassey told analysts in New York on Thursday that the bulk of Allegheny Technologies' capital expenditures in 2011 will focus on construction of the Brackenridge project, which the company is financing internally.

In June, Allegheny Technologies, a Downtown-based specialty metals company, and its Allegheny Ludlum unit announced the selection of Siemens.

ATI did not reveal how much it will pay Siemens, which is based in Vienna. The selection was made after an extensive multiyear study, Greenfield said.

The fully automated mill will give ATI the capability of rolling and processing hot metal bands as wide as 78 inches, compared to its existing mill, which can process metal no wider than 48 inches.

The hot rolling mill and processing plant will reduce the company's cost to produce flat-rolled products and expand its position in key markets, Hassey has said.

Hassey told analysts Thursday that the company will continue to consider potential acquisitions, even as it completes a $778 million deal to acquire Ladish Co. Inc., a Wisconsin-based maker of technologically advanced forged and cast metal components.

That previously announced acquisition is expected to be completed early next year.

Hassey said he anticipates 2011 will be better than this year, and 2012 and 2013 will improve on each preceding year. It's important for Allegheny Technologies to remain diversified, so it is not overly reliant on any one sector, the CEO added.

Those markets include chemical processing, oil, natural gas and electrical energy industries, along with aerospace and defense.

The company has about 2,700 employees in Western Pennsylvania. Besides Brackenridge, ATI's Allegheny Ludlum unit operates plants in Bagdad, Houston, Latrobe, Midland, Vandergrift and Washington, along with its research center in Harrison.

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