Oregon Steel Mills Announces Closure of Pipe Mill

Oregon Steel Mills, Inc. announced that it would permanently close its large-diameter line pipe mill located in Napa, Calif. and sell the pipe mill assets and real estate in separate transactions.

The company has contracted with Casey Equipment Corporation to market the pipe mill equipment and with Cushman & Wakefield to market the real estate. The Napa Mill assets, which include 152 acres of real estate, have a net book value of approximately $31 million. The company expects to record a gain on the eventual disposition of the assets.

As previously reported, the company has approved the construction of a spiral weld double-submerged arc-weld pipe making facility at or near its Portland, Ore., rolling mill. The project, as approved, would consist of two pipe mills with an annual capacity of approximately 150,000 tons, depending on product mix, capable of producing API certified large-diameter line pipe from 24 inches to 60 inches in diameter, in wall thickness of 1/4 inch to 1 inch, and in lengths of up to 80 feet. The project is expected to be completed during the first quarter of 2006.

Until the new mill is completed, the Company will bid for and produce all of its large-diameter line pipe orders at its majority-owned subsidiary, Camrose Pipe company.

The company also announced today that Camrose is expected to produce about 100,000 tons of large-diameter line pipe during the first six months of 2005 versus 2,000 tons for all of 2004. The steel plate requirements for Camrose will be manufactured at the company's Portland, Oregon rolling mill, with plate production beginning in the second half of December 2004.