US Magnesium says it will suspend plant operations in Skull Valley until market conditions are more favorable. It’s a decision that has led to a mass layoff of 186 employees, according to a notice sent to the Utah Department of Workforce Services.
Layoffs and the decision to shut down plant operations were “heavily influenced by deteriorating market conditions for lithium carbonate. Product prices have fallen by 90% since 2022,” it said.
In September, a notice was sent to the state to comply with the Worker Adjustment and Retraining Notification Act, which requires a company with more than 100 employees to provide 60 days’ written notice if employers plan a mass layoff or factory closure affecting 50 or 50 employees. more employees at one location.
The Skull Valley operation covers more than 80,000 hectares and can produce 63,500 tonnes of magnesium, 9,000 tonnes of lithium carbonate, as well as liquid chlorine and other chemicals, according to the US Magnesium website. Hundreds of square miles of evaporation ponds on the Great Salt Lake create a concentrated brine that is used as a raw material in the complex to manufacture the products.
The positions listed in the layoff notice are varied but include top-level titles such as Chief Financial Officer, Vice President of Marketing, Director of Engineering, Director of Sales and Plant Controller. However, the majority of those affected are in ground-level roles within the facility: operators, technicians, maintenance personnel, warehouse workers, supervisors and foremen.
The company’s statement said the owners are “hopeful that these layoffs will be temporary in nature, but we cannot guarantee this” as a reopening depends on the future recovery of lithium carbonate prices.
US Magnesium, which did not immediately respond to a request for comment, is a defendant in a lawsuit filed in October by construction company Forgen. The contractor claims US Magnesium owes nearly $5.8 million in unpaid bills and interest and has filed a lien against the company that could potentially give Forgen the right to sell the property to pay debts, according to court documents.
Evidence in the court documents shows that a purchase order was allegedly issued by US Magnesium for $11.9 million for the construction of a hydraulic barrier wall. In its response to the complaint, US Magnesium denies “that (Forgen) is entitled to any relief whatsoever.”
That wall, described in other court documents as “an underground wall to control pollution,” is part of an effort by environmental regulators to build a “massive control system to isolate and remove all historical and future waste.” to store and process waste flows’. says an EPA report.
Forgen stopped work on the wall at the end of 2023. It is unclear what this will mean for the protection of the area against the migration of hazardous contaminants.
The plant was designated a Superfund site in 2008 due to hazardous chemicals that contaminated soil, air, surface water and groundwater. The EPA currently reports that an “unsafe level of contamination” has been detected at the site, that there is “a reasonable expectation… that humans may be exposed” and that “the migration of contaminated groundwater has not stabilized.”
Air quality in the Salt Lake Valley could be improved by the now inactive facility. In a 2023 federal study, researchers found that high levels of chlorine and bromine released by U.S. magnesium increased particulate matter levels in the Wasatch Front region by 10-25% during a winter inversion period.
