With prices soaring, a power agreement could bring these 700 jobs back to Whatcom
There’s still the issue of a power contract, but if an agreement can be reached, a union official is expressing optimism that the former Intalco aluminum smelter near Ferndale could begin the restarting process as soon as June.
The announcement last week that more than $10 million in funding remains in the state Senate supplemental budget is a key piece to getting the smelter restarted, said Larry Brown, president of the Washington State Labor Council AFL-CIO. He noted that while $10 million is a significant amount of money, potential operator Blue Wolf Capital Partners LLC would be investing quite a bit more in the facility to make significant environmental improvements that would also be safer for workers.
“To me, it’s a big damn deal,” said Brown in a telephone interview with The Bellingham Herald. “We have to do something when it comes to rural economic development and this (private/public partnership) is something we should be replicating across the state.”
Beginning the restart process in four months without a power contract in place is an aggressive timeline, but Brown said other pieces should come together quickly. Brown said surveys indicate that most of the 700 workers who were laid off when the facility was curtailed in the summer of 2020 still live in the area and many appear willing to go back to work at the smelter.
While laid-off workers were offered grants for retraining, they found it difficult to find new jobs with their newly acquired skills, said Trevor Smith in a recent interview with The Herald. Smith is the political director for Laborers Local 292, which represents about 1,400 members across Whatcom, Snohomish, Island, San Juan and Skagit counties.
A potential summer restart is also something Ferndale is also hearing, according to Riley Sweeney, a spokesman for the city, in an email to The Herald. In terms of preparing for a possible return of Intalco, Sweeney said the main concern is housing.
“This restart will draw new employees to our community and despite the accelerated rate of housing construction in Ferndale, the demand still wildly outstrips the supply,” Sweeney said.
Ferndale is currently working with the county and the Port of Bellingham to develop workforce housing proposals to try and meet the need. Sweeney said that could include public-private partnerships as well as putting residential units on city-owned property.
“Unfortunately, all of these developments take time to come to fruition and the housing crunch is now, but better to get started than do nothing,” Sweeney said.
The key at this point is getting a power agreement with Bonneville Power Administration in place. A spokesman for Blue Wolf said the firm is not commenting at this time; BPA has acknowledged that it has had staff discussions with Blue Wolf representatives, but no decision has been made.
Brown said getting a power contract in place is a challenge. While not involved in the negotiations, the current situation as he understands it is that a price agreement is possible but supply is not abundant.
Details on proposed improvements
Brown said the proposed new system would address three issues with the smelter, which began operations in 1966: Cutting pollution, improving worker safety and making the facility more efficient.
Efforts to cut pollution would focus on reducing the amount of particulate matter into the air. The safety component focuses on making it less dangerous to work around the potlines. Efficiency improvements would be through upgrades in computer system technology.
Brown said there have also been discussions about establishing a recycling facility on the property so scrap material can be brought in locally or by rail from other parts of the country.
Market conditions
The price for aluminum is significantly higher than when the Intalco smelter was curtailed almost two years ago.
According to the London Metal Exchange, prices are hovering around $3,300 per ton, a level that previously would make the smelter a profitable operation. The price for a ton of aluminum in July 2020 was around $1,600. Tight supply and the uncertainty around a possible invasion of Ukraine by Russia has pushed prices to their highest levels in 13 years, according to an article by Mining.com.
Brown also noted the need for smelters in the U.S. There are no smelters west of the Mississippi; at one point Washington state had eight aluminum smelters.
