CNG Energy Services of Pittsburgh signed a three-year contractwith Ormet Corp., one the nation’s largest aluminum producers andsuppliers of aluminum products, to provide gas management servicefor eight Ormet facilities in the United States. The facilitiesconsume about 12 Bcf/year
The contract builds on an alliance CNG Energy Services and Ormetannounced last June to jointly manage $1 billion worth ofelectricity over 10 years for two Ormet facilities in Ohio. The gasagreement, which may be extended on a year-by-year basis after itsinitial term, began Jan. 1. The electric agreement coversmanagement and supply of up to 550 MW, which is to begin flowingJan. 1, 2000.
“To the best of our knowledge, this is the first time in theUnited States that such a large energy user has selected one firmto help manage both its gas and electric requirements,” said JosephH. Petrowski, president of CNG Energy Services. “Ormet is clearlyone of industry’s leaders in taking advantage of an integratedapproach in managing its energy needs.”
The gas management agreement covers facilities operated by Ormetsubsidiaries: Ormet Primary Aluminum, Ormet Aluminum Mill Products,Specialty Blanks, and Formcast, at facilities in Hannibal, OH;Burnside, LA.; Jackson, TN; Iuka, MS; Bens Run and Wheeling, WV;Denver, CO; and Terre Haute, IN. Services include supplyacquisition, portfolio consulting, price risk management, delivery,balancing, energy supply backstopping and administration.
The power management agreement covers the electricity needs forOrmet’s aluminum smelter and rolling mill in Hannibal. The smelteris one of the largest aluminum reduction facilities in the UnitedStates. The plant and mill are currently supplied by Ohio Powerunder an agreement that will end Dec. 31, 1999.
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