Repair bill from Algoma Steel piping collapse could hit $30M

Algoma Steel disclosed Wednesday that it could cost as much as $30 million to clean up the mess left by January's collapse of utility piping at its coke ovens.

"We've completed the preparation of the repair plan using both outside engineering and internal resources," chief executive officer Michael Garcia told an investor call.

"We expect the total repair costs to be in the $20- to $30-million range and should be complete sometime in the April time period.

"In terms of costs beyond that our aim is to do a complete recovery back to full production of the coke battery.

"Thankfully, during the incident, none of the three batteries suffered any any thermal integrity degradation.

"We were able to protect the thermal integrity of all three batteries. So once the repair is executed our goal is to get back to pre-incident coke production level," Garcia said.

Rajat Marwah, Algoma's chief financial officer, added: "We probably will be running at 30 to 40 per cent of production and using external coke during this quarter. Come next quarter we should we should get down to full production levels."

"It should be noted that Algoma carries standard insurance coverage that is intended to protect the company at times, like including business interruption insurance.

"We have begun the process of submitting claims under our policy for covered losses, and insurance adjusters and advisors were on site in Sault Ste. Marie.

"We're working closely with them to secure our protection. We expect to have more details on this in coming months," Marwah said.