NEW MARTINSVILLE - Tom Byers knows how vital Ormet Corp.'s 1,000 local jobs are to the economies of Monroe, Wetzel, Tyler, Marshall and Belmont counties, so he hopes to keep the plant open.
Amid reports of a possible shutdown at Ormet's Hannibal Primary Aluminum Reduction Plant - and an uncertain outlook for PPG Industries' Natrium facility as that company plans a $2.1 billion merger with Georgia Gulf - area residents and employees of those companies are concerned about the future.
"Maybe we'll just all end up relying on the gas business around here," said New Martinsville resident Charles Young, referring to the growing oil and natural gas industry in the Upper Ohio Valley. "I just don't think this gas is going to bring us as many jobs as what these other industries have done for us."
Photo by Casey Junkins
Tom Byers, president of United Steelworkers Local 5724 at Ormet Corp.’s Hannibal Primary Aluminum Reduction Plant, reviews some articles published by The Intelligencer and Wheeling News-Register over the years regarding the plant.
"And don't forget coal," added Marshall County resident Deborah Kittle while talking with Young. She noted Murray Energy is laying off 29 coal miners from the Powhatan No. 6 Mine. "The more we struggle with coal, we are going to have problems. This area is still based on coal."
"Things just aren't the same around here anymore," Young added.
Byers, president of United Steelworkers Local 5724 at Ormet, said the Worker Adjustment and Retraining Notification Act notice the company issued recently regarding the potential layoff of 1,000 employees is "quite a concern."
"That is a lot of jobs. And these jobs have been here for 50 years or so now. A lot of these people have deep roots in the community," he said.
Right now, plans only call for Ormet to shut down one of its six potlines at the Monroe County plant, putting 30-50 workers on the unemployment rolls. Byers wants this to be the only reduction in force for the facility. The notice, however, shows Ormet is prepared to cut as many as 837 hourly and 161 salaried positions by the end of this year.
"I am hopeful that even though the WARN notice has been issued, the problem will be resolved before they have to shut down the plant," he said. "The WARN notice lets you know it is a possibility, though. It would just be devastating for this area."
Although the number of jobs at Ormet may be less than a couple of decades ago, Byers said the work force has remained relatively stable since the plant's restart in late-2006, following a strike. Last year Ormet officials inked a new five-year contract with union workers at the Hannibal plant.
"We have members of our union who commute over an hour to get here. But most of them are from this local area, along both sides of the (Ohio) river," he said.
Mike Tanchuk, Ormet's president and chief executive officer, said last week that uncertain metal market conditions and rising electricity costs are the main reasons the company may need to lay off so many workers. Among those global matters, Tanchuk said, is the unstable situation with European currency. He said the metal is traded on the London Metal Exchange in U.S. dollars.
"Demand for the physical metal is very good," Tanchuk said last week. "Our employees are all doing a great job - this is in no way a reflection on them or their efforts. This is all about pricing and macroeconomic issues."
Byers agreed with Tanchuk on this matter.
"Like Mr. Tanchuk said, this is not any fault of the workers. We cannot control the price of metal or the price of power."
Another factor in Ormet's future will be the cost of electricity. Tanchuk said American Electric Power may raise his company's rates to a point that it cannot maintain current operations. An AEP representative declined last week to comment specifically about Tanchuk's assertions but noted AEP believes it is working on a deal that will be fair to all consumers.
AEP announced plans last year to close the Kammer Plant south of Moundsville by the end of 2014, citing increased air pollution regulation by the U.S. Environmental Protection Agency. The Kammer facility opened in the late 1950s, primarily for the purpose of supplying electricity for the Ormet plant, although it no longer serves in that capacity.
Prior to the WARN notice, Byers said things seemed to be going fairly well at Ormet. The firm posted a $1.1 million net loss for the first three months of 2012, but Ormet officials spent $1.9 million during that time to reline 22 pots at the Hannibal facility. In the first three months of the year, workers shipped 67,981 metric tons of product, compared to 58,079 tons during the same time in 2011.
Byers said a better working relationship with Tanchuk should also help the company in its efforts to stay in business. While the relationship between union and management at Ormet has been very contentious at times through the years, Byers said that is not the case now.
"We have a lot better communication now under Mr. Tanchuk's leadership than we did with prior Ormet management," Byers said.
Another person who also hopes Ormet stays in operation is Pine Grove resident Roger Fluharty, who said his son-in-law works at the plant.
"Everyone around here knows someone who works there. If Ormet shuts down, it's not going to be good."
"Things get pretty slow around here when Ormet lays off," Young added. "With the potential of that many, they would be really slow."
Across the Ohio River, about 500 employees at the the PPG Natrium facility are waiting to learn how the company's $2.1 billion deal to merge its chemical business with Georgia Gulf will affect them.
The PPG Natrium plant - located south of Moundsville along W.Va. 2 - manufactures chemicals such as chlorine, caustic soda, muriatic acid and calcium hypochlorite. These chemicals have a wide variety of end-uses including water purification, paper and plastics production and as key building blocks for pharmaceuticals.
Information provided by PPG notes the specific terms of the transaction call for PPG to form a new company by spinning off its chemical business before merging with Georgia Gulf. This is expected to happen late this year or in early 2013. The merged company will have about 6,400 employees working at more than 40 facilities, primarily in North America.
Plant Manager Jim Rock said the future name of the Natrium plant is yet to be determined, as it will take the same name as the new company.
"We intend to keep operating as we have been. We have no plans to close the plant," Rock said.
PPG spokesman Jeremy Neuhart said the company will operate on a "business as usual" basis until the deal is totally final.
"At PPG, it's hard to say," Young noted. "They may end up taking some of the equipment out of here to ship to somewhere else for work."
"I hope they keep as many people working as they can. I hate to see anyone lose their jobs, especially around here," Kittle added.