Century Aluminum stopping operations in Hawesville for 9 to 12 months

HAWESVILLE, Ky. (WFIE) - A letter from Century Aluminum to some employees in Hawesville shows they are stopping operations for up to a year due to the rise in global energy prices.

The letter shows this will mean layoffs for 628 Hawesville smelter employees, including 504 union members.

The layoffs are expected to start August 5 and be complete by August 20.

It shows the layoffs are temporary, but could be for nine to 12 months.

Here is the full letter from Century Aluminum to employees:

In order to continue to operate its smelter located at 1627 State Route 3543, Hawesville, Kentucky (the “Hawesville Smelter”'), Century Aluminum of Kentucky GP (“Century” or the “Company”) must be able to purchase reliable, affordable electric power. Unfortunately, an unprecedented rise in global energy prices arising from the Russian war in Ukraine has dramatically increased the price of energy in the U.S, and l around the globe. The cost required to run our Hawesville, KY, facility has more than tripled the historical average in a very short period, Given these circumstances it is necessary to fully curtail operations for a period of approximately nine to twelve months at Hawesville until energy prices return to more normalized levels. This is expected to result in the layoff of 628 Hawesville Smelter employees, including 504 employees represented by the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial Service Workers Union, AFL-CIO (USW”).

The Company intends to begin the curtailment process immediately, and at the same time, prepare the facility for a restart when energy prices stabilize. We expect that employees will begin to be laid off the week of August 5, 2022, and it is currently anticipated that all of the layoffs will be completed by August 20, 2022. The specific schedule of the layoffs will be determined based on the progress of the curtailment process described above. To the extent that employees are laid off less than 60 days from the date of this notice, they will be paid the difference in accordance with the WARN Act. All layoffs of employees represented by the USW will be conducted in accordance with the collective bargaining agreement currently in effect between Century and the USW. As such, some US W-represented employees may have bidding or bumping rights as set forth in the collective bargaining agreement. At this time, it is expected that these layoffs will be temporary, but the Company expects that the layoffs will be for nine to twelve months. When the Company’s anticipated energy costs return to a level that makes the Smelter economically viable, the Company plans to restore manufacturing operations at the Hawesville Smelter up to previous levels.

Attached as Schedule “A” to this letter is a list of bargaining unit positions expected to be affected by the layoff, the dates of the anticipated layoff, and as the number of affected employees in each job classification. Attached as Schedule “B” to this letter is a list of the names of the workers currently holding these jobs, Should cireumstances change any of the Company’s plans with respect to these layoffs, I will provide the USW with additional information regarding the impact on employment levels at the Hawesville Smelter...”

Century Aluminum sent out a news statement late Wednesday afternoon with the same information.

It says:

“Century Aluminum Company (NASDAQ: CENX), the largest producer of primary aluminum in the United States, has announced it will temporarily idle its smelter in Hawesville, Kentucky, as a direct result of skyrocketing energy costs. The smelter is expected to begin the idling process on Monday, June 27th.

The company says it expects to idle operations for a period of approximately nine to twelve months until energy prices return to more normalized levels. Century continues to explore all available options to avoid the temporary curtailment.

The Hawesville facility is the largest Century Aluminum smelter in the U.S. and the largest producer of military-grade aluminum in North America. It currently employs more than 600 workers, most of whom unfortunately received notice today under the WARN Act that they will be temporarily laid off. Century Aluminum is working with all of its employees and the local union to help identify unemployment support and training opportunities.

Jesse Gary, the Company’s President and Chief Executive Officer, commented, “This unprecedented rise in global energy prices arising from the Russian war in Ukraine has dramatically increased the price of energy in the U.S. and around the globe. The power cost required to run our Hawesville, KY, facility has more than tripled the historical average in a very short period. Unfortunately, this makes it necessary to temporarily curtail operations for approximately nine to twelve months until energy prices return to more normalized levels. We are confident that energy prices will moderate in the next year and believe strongly in the future prospects of the Hawesville smelter given its recent performance and the continuing important role it plays in US national security.

“Our dedicated and highly-skilled employees are like family to us, and we are saddened that the current energy crisis triggered by the war in Ukraine has forced us to take this action. We will work with all of our employees to help them identify local unemployment resources and training opportunities.”

Given the unique circumstances at each of Century’s plants, the company does not have any current plans to idle any other facility.”

Century Aluminum in Sebree just shared Monday that they have a hiring event next Wednesday.”

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