Contamination Stands in Way Of Sale of RG Steel Facility

The now-defunct RG Steel’s failure to properly address soil contamination problems at its Yorkville plant is now standing in the way of the plant’s sale.

RG Steel, which filed for Chapter 11 bankruptcy protection on May 31, sold most of its holdings in Ohio, West Virginia and Maryland through court-ordered auctions.

Sewickley, Pa., based Esmark Steel and South Korea’s TCC Steel emerged as the high bidder for the Yorkville operation at $4.7 million, but the transaction stalled over the environmental issues stemming from how RG handled soil contaminated by pickle-liquor spills at the site.

Pickle liquor is a chemical bath used to clean steel being processed. Pipes at the Yorkville plant apparently failed, allowing the contents to leak.

In an April letter to RG Steel, the U.S. Environmental Protection Agency referred to incomplete or incorrect documentation involving incidents that date to 2010.

Esmark Chairman and Chief Executive Officer Jim Bouchard has said the sale must close very quickly or his bid will likely be pulled, prompting local leaders to call for state and federal assistance.

“This is an opportunity for the governor and others to demonstrate their commitment to supporting manufacturing jobs in Ohio,” said state Sen. Lou Gentile, D-Steubenville. “This is the time to demonstrate the commitment they have spoken of. Preserving these steel jobs is vital to our citizens and our economy. … This is a situation made even more important when you realize it is the only one of the group of mills sold to a buyer planning to get it back in operation in the immediate future.”