Big River Steel superproject investor John Correnti is as excited as a football coach with championship expectations at the start of the season.
On Thursday (Sept. 19), the Arkansas Department of Environmental Quality approved an air permit for the $1.1 billion, 525-job steel mill superproject to be located in Osceola, Arkansas.
“It’s about a 25-yard run or pass play,” Correnti said of the permit approval, one of the final details needed to complete overall financing on the deal. “It’s put us in the red zone… but a touchdown is not a touchdown until you cross the goal line.”
Announced in January 2013, Big River Steel Mill is an advanced manufacturing, state-of-the-art production plant and will produce steel for the automotive, oil and gas, and electrical energy industries. Arkansas lawmakers approved a $125 million bond package under the auspices of Amendment 82, the state’s superproject amendment, to secure the location would be built in Mississippi County. State and local officials also devoted millions of dollars in additional incentives to land the superproject.
Big River Steel was formed by long-time steel executive and entrepreneur John Correnti and a team of industrial and financial investors. Correnti once headed Nucor Steel and its two steel mills also located in Mississippi County. He has nearly 40 years of experience in the steel industry.
Correnti spoke with Talk Business Arkansas on Friday and said the next stage of the process for the superproject will now shift to financing. Correnti, who leads the investor group building Big River Steel, said that securing funding for the initial $250 million that must be invested before any state funds are released for the project is crucial.
“This is the debt portion of the total financing. They’re just now reviewing the marketing study, the engineering study, and the accounting study, just like if you or I went into a bank to get a loan or a mortgage,” he said.
All told, the capital budget for Phase I of the steel mill consists of $721 million in equipment, $303 million in building and construction costs, and $10 million in land costs. The mill will employ 525 workers initially with average annual wages of $75,000 – more than double the state’s per capita income.
However, the final touches on financing haven’t slowed Correnti down. He’s multi-tasking by working with locals, signing contracts for the major equipment purchases for the plant, and other details necessary in anticipation of the financing coming through.
“By mid-October, we’ll be putting out the bid packages for the major site preparation work. That’s clearing the land, putting the roads and railroads in, putting the ramp over the top of the levee and up to the river,” he said.
Correnti said that groundbreaking on the 1,000 acre, $1.1 billion superproject is expected to take place between Thanksgiving and Christmas, less than one year after Big River Steel was announced. When construction starts, it will be a big economic boost for the local community.
Throughout the building process, which will take about 18-20 months, Correnti expects up to 2,000 construction-related jobs to unfold in northeast Arkansas.
The plant itself will come online for operations in late 2015, Correnti projects, which will lead to the 525 jobs he expects the steel mill to employ.
“I’ve done this quite a few times before and it’s like a shot of B-12 in a community’s arm,” he said. “I’m excited about it.”