Kalama wine bottle factory to reopen next summer

KALAMA, Wash. (AP) — Bennu Glass has secured the financing and permits needed to reopen the shuttered Kalama wine bottle factory and will start hiring employees in January, company officials said Wednesday.

"We've got people to hire, people to train and equipment to turn on," said Jerry Lemieux, CEO of Bennu Glass.

The plant should go into production in July, about seven months later than Lemieux had anticipated last spring. He said the company needed extra time to secure $40 million to $50 million in loans needed to rebuild the plant.

"It was a long and torturous process in this credit environment, as you can imagine," Lemieux said.

Bennu will employ about 100 full-time workers. The company plans to hire about 30 contract employees to demolish the ruined electric melter installed by previous owner Cameron Glass, install a the new melter and construct new facilities.

A massive molten glass leak crippled the Cameron plant just weeks after it opened in January 2009, and the Pennsylvania-based company shut down the plant that September. Cameron Glass declared bankruptcy a month later, apparently ending a venture that was one of the area's best economic development wins in years.

However, in March 2010, Bennu bought the plant at a bankruptcy auction for $64.8 million. The company plans to install a new glass melter fueled by liquid oxygen, which will heat the glass to 2,800 degrees Fahrenheit, Lemieux said. It's standard glass-making technology — unlike the risky electric melter the Camerons installed and which never worked properly.

The new melter will require tens of thousands of gallons of superchilled liquid oxygen per day, which will be stored in a warehouse that Bennu will build, he said.

Bennu must first remove and demolish the electric melter, which the Camerons shut off abruptly with about 450 tons of molten glass inside. Lemieux said Bennu will need to jackhammer out the hardened glass and take apart the old melter piece by piece.

The hardened glass looks like a giant chunk of black obsidian rock and would fill about 10 large dump trucks. The company can't reuse the glass because jackhammering it out will contaminate it with other materials and make it useless, Lemieux said.

Bennu, which plans to produce 100 million bottles a year, is owned by New York-based financial firm Medley Capital, which invested about $30 million in the $109 million Cameron plant.

Lemieux said he will be seeking suppliers over the next few months, and he'll be making several trips to California. Bennu plans to sell mostly to smaller wineries, who often buy bottles from Mexico and China because they can't find enough supply from other U.S. plants.

Bennu's competition is six wine-bottle plants are on the West Coast, all owned by wine bottle manufacturing giants. St. Gobain owns two plants in Seattle and California, Owens-Illinois owns one facility in Portland and two in California and Gallo owns the West Coast's largest plant, located in Northern California.

Industry experts say wine sales have been steady throughout the recession, and the Washington's largest winery, Ste. Michelle Wine Estates in Woodinville, turned a big profit in the last quarter. Poor harvests have slowed production, but the overall market looks strong, experts say.

"People drink when times are bad, and people drink when times are good," said Ryan Pennington, spokesman for the Washington Wine Commission.

Local wineries also prefer to buy domestic equipment when they can, and many have complained that foreign bottle makers lack consistent quality.

"People are looking to increase production, and they're always looking to source local, if they can," Pennington said.

Copyright 2011 The Associated Press.