THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Wednesday, March 8, 1995 TAG: 9503080495
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY MYLENE MANGALINDAN AND DAVE MAYFIELD, STAFF WRITERS
LENGTH: Medium: 88 lines
F. Kenneth Iverson is a flirt.
Since last fall, he's teased and encouraged courtings from Virginia and South Carolina, playing one off the other and making both jealous.
The smooth-talking chairman and CEO is dangling the promise of a $500 million steel mill that would employ 600 people. Charlotte, N.C.-based Nucor, the nation's fourth-largest steel maker, is such an attractive catch that both states seem to be pulling out all the stops to win.
Iverson has managed to entice and perplex state officials, utilities and the media as he coolly decides where to locate his mill.
``We're getting closer to a decision, but we're not there yet,'' Iverson said Tuesday.
The soft-spoken, friendly CEO said he would like to make a choice and inform the key parties involved by Thursday. If he doesn't do so by this week, his decision could be weeks away.
Here's a hint.
South Carolina Gov. David Beasley leaves Friday for a trade mission to Japan and Taiwan and won't return until March 21, the governor's press secretary said.
What seems settled in this high-stakes game is that Nucor has narrowed the field to two sites: Cainhoy, S.C., - 25 miles outside of Charleston - and a site outside West Point, Va., in King William County.
Iverson and other Nucor officials have been coy - or perhaps cunning - when speaking to reporters and others about their leanings. Sources from Virginia seem to feel the commonwealth has the edge based on recent conversations with Nucor.
Meanwhile, some South Carolinians have been led to believe that they're the favorite. Iverson teased that state this week by telling a South Carolina newspaper: ``We do have a better site in South Carolina, there's no doubt about that.''
When asked about the comment Tuesday, Nucor President John Correnti said, ``Both locations are still viable candidates for the mill at this time.''
He also stressed that his company wants to make a decision soon.
Some sources suggest that Nucor has used Virginia all along to squeeze a better deal from South Carolina. Others feel Nucor has wanted the Virginia site from the very beginning.
South Carolina may have reason to feel optimistic. It's site has deeper water and a larger space to fit steel barges that may transport scrap metal to Nucor's site. That's a huge advantage, said a source close to the negotiations.
If Nucor were to choose the Virginia site, it would need to transport its supplies to smaller barges that could navigate the shallower waters.
Not a problem.
To help Nucor get barges to and from its proposed site, the Virginia Department of Economic Development has asked the U.S. Army Corps of Engineers to dredge the York River slightly deeper than proposed.
In a Feb. 27 letter, the corps responded that deepening to 25 feet a federal channel from Yorktown to West Point is feasible but would be expensive and difficult.
Nucor had hoped to run its barges up the Pamunkey River to the proposed site outside of Cohoke. But the water there is too shallow.
Nucor now is investigating the possibility of running its barges up the York River to West Point, unloading materials and scrap steel there and placing them on rail cars for transport to Cohoke, Iverson has said.
Transportation is just one part of the equation. It takes power, lots of it, to melt and forge steel.
For that reason, utility companies from both states may be the most anxious of all to have Nucor in their embrace. They are tempting Iverson and company with sweetheart package deals on cheap electricity rates.
Nucor has talked to at least three different utilities in South Carolina about rates, tax breaks and other concessions.
Virginia Power has offered Nucor a 15-year contract under which its rates would vary hour by hour, based on the price of electricity at the time.
``What we have done is offer them a contract,'' Virginia Power spokesman Bill Byrd said. ``And we believe it is very competitive with the options they have on the table right now.''
Virginia Power's contract proposal has been with Nucor for several weeks, but Byrd does not know if Nucor has asked for any changes in it.
``We feel like we have fought the good fight,'' Byrd said. ``We have done the homework and made an attractive, competitive offer, and now the ball's in their court, as it should be.'' MEMO: Staff writer Scott Harper contributed to this report.
ILLUSTRATION: Color map by Ken Wright
by CNB