Steel Mills

Canadian Government Tells EVRAZ: "We've Got Your Back"

March 7, 2019

The federal government of Canada announced it will give EVRAZ North America C$40 million ($29.78 million U.S.) from its Strategic Innovation Fund to help with C$112.6 million of upgrades planned at facilities in Regina and Red Deer, Alberta.

“This will enable the company to produce valued-added OCTG products that match Canadian market demand and make them available at a competitive price to Canadian resource firms that, like EVRAZ, are facing shortages owing to the cost-prohibitive effects of U.S. tariffs,” said the Canadian government in a press release.

The upgrades will increase steelmaking capacity, reduce emissions and improve efficiency. The project will create 35 jobs at Red Deer and maintain more than 2,100 others in Alberta. Upgrades will be made between 2019 and 2021 and include:

Electric arc furnace power increase
Reheat furnace throughput increase
Red Deer heat treat expansion line
Red Deer threader line upgrade

“Your competitiveness has been wrongfully blunted since June of last year by the imposition of U.S. tariffs, illegal and totally unjustified tariffs imposed on the specious grounds of national security,” said Public Safety Minister Ralph Goodale in comments at the Regina steel mill on Wednesday. “We’re in this together and the Government of Canada has your back.”

EVRAZ NA President and CEO Conrad Winkler said that 2018 was a “rough” year for the company, with long backlogs and many orders heading to the United States. Both the Canadian and U.S. operations were “significantly” affected by the Section 232 tariffs.

“In 2019, most of our order book here in Regina is staying in Canada,” he said. “We’ve got several large projects, so the impact in 2019 should be considerably less.”

EVRAZ and its customers have joined with the Canadian government to lobby Washington for the removal of the Section 232 measures. Goodale noted that Canada would find it “difficult to implement the new NAFTA” while the tariffs remain in place.