Alabama Provides Grant to Lakeside Steel for Steel Pipe Mill

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Researched by Industrial Info Resources (Sugar Land, Texas)--Lakeside Steel Incorporated (TSV:LS) (Welland, Ontario) is a diversified manufacturer of steel pipe and tubing. Lakeside Steel formed Lakeside Steel Alabama (Thomasville, Alabama) for its venture into the United States in 2009. The company's pipe-making facility in Thomasville, Alabama, is well under way. A groundbreaking ceremony took place in September 2010. The projected annual capacity for the plant is 192,000 tons of oil country tubular goods (OCTG) and line pipe.

The OCTG casing and line pipes will range from 4 1/2 to 10 3/4 inches diameter, and will be up to 60 feet long. Production is expected to start by the end of the year. Alabama has granted $500,000 to help build the infrastructure for the pipe mill. These projects will include an improved road and parking, sewer and water services and a rail spur to connect the new mill to a main rail line. The site already contains an 8- to 12-railcar slip and will be serviced by the Norfolk Southern Railway System (NYSE:NSC).

Thomasville, which has a population of almost 100,000, is located in southwestern Alabama, about 95 miles north of Mobile. The new mill's location is ideal, as it is located within a 160-mile radius of three major flat roll suppliers: Severstal North America (Columbus, Mississippi); Nucor Steel Tuscaloosa Incorporated (Tuscaloosa, Alabama), a subsidiary of Nucor Corporation (NYSE:NUE) (Charlotte, North Carolina); and ThyssenKrupp AG's Calvert, Alabama, mill. The location near the Gulf Coast provides proximity to energy and refining markets, and the Marcellus Shale is about 800 miles away. Thomasville was chosen for its infrastructure capacity, the availability of a reliable workforce, and the city's proximity to raw materials and markets.

Jesco Incorporated (Montgomery, Alabama) has been hired as the general contractor for the project, and Freedom Machinery Incorporated (Grand Rapids, Ohio) will supply equipment for the tube mill and pipe mill, as well as coil-processing and steel mill equipment. The welding and annealing equipment is being supplied by Thermatool (East Haven, Connecticut).

Lakeside Steel plans for the main buildings and infrastructure to be completed during the second quarter of this year. Once completed, the company will initiate the equipment installation, followed by general commissioning of the plant. When fully operational, the plant expects to employ 75 people. Lakeside expects to commence with employment screening, training and hiring in February. The facility is expected to be fully operational by October 31, 2011.

Industrial Info has been tracking this project since its early conception (site selection) in June 2010.

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