DRI production suspended at Nucor Steel Louisiana after equipment failure

Tuesday, 11 November 2014 01:04:26 (GMT+3)   |   San Diego
       

Nucor Corporation announced Monday that an equipment failure occurred at Nucor Steel Louisiana in St. James Parish. The failure is related to the process gas heater, which experienced a major failure on November 2, 2014. There were no injuries, no environmental impact and no damage to any other part of the direct reduced iron (DRI) facility as a result of this incident. Production operations were suspended after the failure. Nucor is still assessing the extent of the equipment damage and cannot estimate the length of time needed to make the necessary repairs to the process gas heater at this time. Nucor will provide an estimate of when the facility will be fully operational when it is available.

The process gas heater is not a part of the DRI technology utilized by Nucor Steel Louisiana, but is a piece of equipment necessary for the facility to operate. The process gas heater is an auxiliary unit that is standard equipment in several industrial applications, particularly the chemical industry. This same piece of equipment contributed to production outages in July and September.

In its most recent earnings release on October 23, 2014, Nucor stated, "As a result of the process improvements and lower iron ore costs, combined with a steady run-rate, we expect significant improvement in the performance of the Louisiana DRI facility in the fourth quarter and profitable results during the first quarter of 2015." The time frame for when Nucor Steel Louisiana's performance will improve and become profitable has been deferred as a result of the equipment failure and cannot be estimated at this time. As a result of the failure, Nucor expects the negative impact to earnings in the fourth quarter of 2014 to be somewhat less than the impact of Nucor Steel Louisiana's operating loss in the third quarter of 2014.  


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