U. S. Steel and Kobe Steel Announce Capital Investment in PRO-TEC Coating Company
Joint venture partners to build continuous annealing line to produce high strength steels to better serve automotive customers.
LEIPSIC, Ohio, Dec. 2, 2010 /PRNewswire-FirstCall/ -- United States Steel Corporation (NYSE: X) and Kobe Steel, Ltd. announced today that they have reached an agreement for their joint venture, PRO-TEC Coating Company in Leipsic, Ohio, to begin construction on a continuous annealing line at the facility. The project is expected to increase the joint venture's ability to serve its automotive customers. The capital investment for this project is approximately $400 million and is expected to create 500 temporary construction jobs as well as 80 full-time jobs once operating. PRO-TEC has obtained financing commitments for the project subject to final documentation and other closing conditions. Completion of the project would take an estimated 24 months.
U. S. Steel and Kobe Steel, through their joint venture in PRO-TEC, have been supplying the automotive industry with hot-dipped galvanized high-strength steel since 1993. With the addition of the continuous annealing line, PRO-TEC will now produce cold-rolled advanced high-strength steels and ultra high-strength steels for certain automotive structural parts. This material further assists automotive manufacturers to enhance the strength and safety of their vehicles while reducing the vehicle's weight, improving its fuel efficiency and emission requirements. The new continuous annealing line will have an annual production capacity of 500,000 tons. The line will process steel purchased from U. S. Steel and will be equipped to utilize both advanced water quench technology and a rapid gas jet cooling system to meet customer requirements
"With this investment PRO-TEC Coating Company, both U. S. Steel and Kobe Steel are well-positioned to serve our automotive customers. PRO-TEC is an industry leader in quality sheet steel products and we are pleased to bring another quality product to market," said John P. Surma, chairman and chief executive officer of United States Steel Corporation. "We thank all of Ohio's regulatory authorities, economic development agencies and elected officials for assisting the partners in our expansion of PRO-TEC Coating Company."
PRO-TEC Coating Company, Leipsic, Ohio, provides world-class coated sheet steel in coil form primarily to the quality-critical automotive industry. These products help to improve vehicle crashworthiness as well as fuel economy through weight reduction. PRO-TEC is a 50/50 joint venture partnership of United States Steel Corporation and Kobe Steel, Ltd., of Japan. With a one million ton annual capacity, PRO-TEC is one of the world's largest facilities producing high-end automotive sheet steel for the automotive industry. PRO-TEC was awarded the Malcom Baldridge National Quality Award by the U.S. Department of Commerce in 2007.
United States Steel Corporation, headquartered in Pittsburgh, Pa., is an integrated steel producer focused on high value-added flat-rolled and tubular steel products with complex chemistries and attributes that are required by manufacturers in the automotive, appliance, container, construction, industrial machinery, and oil and gas industries. U. S. Steel has major production operations in the United States, Canada and Central Europe and has an annual raw steelmaking capability of 31.7 million net tons and employs more than 42,000 worldwide.
Kobe Steel Ltd., with head offices in Kobe and Tokyo, Japan, is one of Japan's leading integrated steelmakers of high-end steel products. It also produces welding, aluminum and copper products. Kobe Steel's diverse segments offer industrial machinery, construction equipment, engineering and environmental solutions. Other businesses include real estate and electronic materials. Kobe Steel has operations in Japan, the United States, Europe and Asia. In the fiscal year ended March 2010, Kobe Steel produced 6.6 million metric tons of crude steel and employed 33,600 people. More information is available at: www.kobelco.com.
This release contains forward-looking statements concerning the construction of the new facility. The timing, cost, capability and financial performance of the facility are subject to, among others, the receipt of necessary government permits; terms of construction contract;, availability of necessary labor, technology and materials; general economic conditions; and developments and conditions in the North American auto industry, which is the principal market for the new facility.
For more information about U. S. Steel, visit www.ussteel.com.
SOURCE United States Steel Corporation