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Economic and dam related articles

Investment Firm in Talks with BPA for
Power Contract that Could Reopen Whatcom's Intalco

by Dave Gallagher
Bellingham Herald, January 28, 2022

The Alcoa Intalco aluminum smelter, as seen from the air Sept. 19, 2013, will remain open at least two more years after a power deal was announced Tuesday, January 28, 2022. The Ferndale smelter had been scheduled to have its operations curtailed in June, laying off 465 workers. (Bellingham Herald photo) Discussions are taking place on power for the curtailed Intalco Works facility, but it is unclear yet whether an agreement can be reached that would reopen the facility.

The Bonneville Power Administration is in discussions with Blue Wolf Capital Partners LLC about supplying power to the aluminum smelter near Ferndale.

Doug Johnson, a senior spokesperson for BPA, confirmed that agency staff have talked with Blue Wolf representatives. Blue Wolf's interest in the Intalco facility was first reported in The Northern Light.

"We are continuing discussions, but BPA has made no decision regarding potential service, contract terms and conditions or BPA's involvement in electric service to the plant," Johnson said in an email to The Bellingham Herald.

Blue Wolf would need to work out a deal not only with BPA, but also with Alcoa in order to restart the facility, said Don Goldberg, director of economic development for the Port of Bellingham. Goldberg recently made a short presentation to the state legislature to voice approval for a proposal to provide state funding that would help bring in new equipment that would run the facility more efficiently and significantly cut carbon dioxide emissions.

Reopening the facility could bring back around 700 manufacturing jobs to Whatcom County. The facility closed in the summer of 2020 because of declining conditions in the aluminum market.

Blue Wolf did not immediately respond to a request for comment on Thursday, Jan. 27. The New York City-based company says on its website that it invests in different business situations and industries, including health care, oil and paper manufacturing.


Past power agreements between Alcoa and BPA were often contentious, with many deals being struck close to the deadline to avoid a shutdown of the smelter.

Aluminum smelters use a lot of power, so negotiating power price is key to profitability. In the last contract, BPA and Alcoa reached a 10-year agreement in 2012. An amendment was added to the contract in 2016 to keep the facility operating as the company dealt with an oversupply on the global market that led to a drop in aluminum prices.

With no power contract currently in place for the facility, Blue Wolf will be negotiating under a different circumstances. According to its website, BPA provides power to about 28% of the electrical power in Pacific Northwest, selling the power to cover its cost as a self-funded federal agency. It is unclear how much extra power it would be willing to sell and at what price.

Goldberg, who is not involved in the negotiations, doesn't have a sense of how the contract process is going.

"But I do believe Blue Wolf is very real and wants to move forward," Goldberg said. Last fall it was reported that there were two companies in the running to try and take over Intalco, the second being a steel mill proposal that focused on recycled material. Goldberg told The Northern Light newspaper that the steel company is not as far along as Blue Wolf in making a deal for the facility.

Related Pages:
Speakers Address National Security Risk of Closing Intalco by Brent Lindquist, Lynden Tribune, 4/23/20
New Ferndale Smelter Energy Deal Made to Benefit Both BPA, Alcoa by Dave Gallagher, Bellingham Herald, 4/13/16
Alcoa in Power Deal that may Keep Intalco Aluminum Plant Open by Josephine Mason, Reuters, 4/13/16
Intalco Aluminum Smelter in Ferndale may Stay Open by Dave Gallagher, Bellingham Herald, 4/12/16
Alcoa Hiring Temporary Employees for Ferndale Smelter Work by Dave Gallagher, Bellingham Herald, 2/28/16

Alcoa Intalco Works' timeline of 54 years in Whatcom County

Alcoa Corporation announced Wednesday, April 22, that it will close its Intalco Works aluminum smelter near Ferndale amid declining market conditions, laying off 700 employees. Legislators said they will do what they can to save the facility that has been in Whatcom County for 54 years.

Sources: Bellingham Herald files, Alcoa Intalco Works

Dave Gallagher has covered the Whatcom County business community since 1998. Retail, real estate, jobs and port redevelopment are among the topics he covers.
Investment Firm in Talks with BPA for Power Contract that Could reopen Whatcom's Intalco
Bellingham Herald, January 28, 2022

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