Nippon Steel commits to $300M investment in Gary Works
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Japan-based Nippon Steel plans to invest $300 million in U.S. Steel’s Gary Works operation if its $14.1 billion acquisition of the Pittsburgh-based steelmaker is completed as planned.
Nippon said Wednesday that the investment would revamp the Blast Furnace #14 at Gary Works, extending the facility’s operational life by up to 20 years. The company is also investing at least $1 billion in its Mon Valley Works facility in Pennsylvania.
In a statement released Wednesday, Gary Mayor Eddie Melton said he has advocated for increased investment in Gary Works during meetings with Nippon CEO Hiroshi Ono.
“As a child of a steelworker, I want to make sure the current steelworker’s contract was honored, and that Gary remained a priority among the other plants across the United States,” Melton said. “Investing in the blast furnace will allow a higher production of steel and reduce emissions. This will benefit steelworkers in Northwest Indiana, the environment, and the citizens of Gary.”
Nippon said revamping the blast furnace will allow U.S. Steel to “realize significant operational benefits, while customers will benefit from the continuation of environmentally friendly blast furnace production at Gary Works.”
The company said the newly announced investments are in addition to $1.4 billion in previously announced capital commitments.
“From the outset, we have been clear in our admiration for the entire U. S. Steel portfolio and our desire to provide investment and technical expertise to protect and grow U. S. Steel as one of the world’s best steelmakers with world-leading capabilities,” Nippon Steel Representative Director and Vice Chairman Takahiro Mori said in written remarks. “The investments announced today will help make U. S. Steel’s blast furnace facilities more productive and environmentally sustainable.”
U.S. Steel announced the proposed sale to Nippon in December 2023. The deal has received much scrutiny from the United Steelworkers union, as well as President Joe Biden.
In a joint statement Wednesday, USW District 7 Director Mike Millsap and International President David McCall continued to criticize both Nippon and U.S. Steel, saying “a press release is not a contract.”
“Even as it pays lip service to one of the union’s ongoing concerns, Nippon continues to duck the USW’s input,” the statement reads. “We can’t trust in what USS and Nippon are telling us, but the truth is still clear: Nippon is still trying to hide behind its North American shell company to shield itself from its contractual obligations to retirees and our communities, and it still needs to answer to pressing concerns regarding our critical supply chains and national security. This is just more of what we’ve seen all along: lots of words, no real change.”
The deal received approval from U.S. Steel shareholders in April, as well as all non-U.S. regulatory approvals the following month.
Nippon said the investment in Gary Works is subject to the closing of the acquisition, which is expected to occur by the end of the year, pending U.S. regulatory approvals and customary closing conditions.