Sector News

Chemours to close Edgemoor, DE titanium dioxide plant

August 20, 2015
Chemical Value Chain
Chemours will close its Edgemoor, DE titanium dioxide (TiO2) plant by the end of September. The company also plans to shut a small TiO2 line at its New Johnsonville, TN site. The closures will eliminate roughly 150,000 m.t./year of TiO2 capacity as it nears completion of a 200,000-m.t./year plant at Altamira, Mexico. Production at the $600-million Altamira TiO2 unit is scheduled to start up in mid-2016. The closures are expected to result in a $45-million annual net cost reduction. Chemours is the largest global producer of TiO2 with current annual capacity of approximately 1.2 million m.t.  
 
Chemours, which was spun off from DuPont on 1 July, says the Edgemoor plant produces TiO2 for use in paper applications that have declined steadily for years, which has resulted in underused capacity at the plant. 
 
The Edgemoor plant has approximately 200 employees and 130 contractors. Chemours says it will redeploy employees wherever possible. The company expects $190 million in pre-tax charges related to the Edgemoor shutdown, comprised primarily of non-cash impairment of $110 million and cash expenditures of approximately $80 million. The Company expects to incur all of the non-cash charges and approximately $15 million of cash charges in the third quarter. The remaining cash charges are expected to be incurred during the next two to three years, primarily for decommissioning, dismantling and removal. Chemours expects to complete decommissioning at Edgemoor around March 2016 and then begin dismantling facilities, which could take a year or longer depending on future use of the site. 
 
“A plant closure is never an easy decision, because of its impact on people who are valued members of our company,” says E. Bryan Snell, president of Chemours’ TiO2 business. “Chemours is committed to the TiO2 market, and these changes position us for growth. Our plants in Mississippi, Tennessee, Mexico and Taiwan enjoy industry-leading productivity, as well as the ability to use ore feedstock across the quality spectrum. These factors give us a low-cost position that is a key competitive advantage. Meanwhile, underused capacity at our Edgemoor plant keeps it from being cost-effective. And, the line at New Johnsonville is relatively small scale and high cost compared to our other production units.”
 
By Robert Westervelt
 

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