CVMR President Michael Hargett, left, and Kamran Khozan, chairman and chief executive officer, joined local, state, and federal officials on Friday, March 13, 2015, to announce they’re moving company headquarters from Toronto to Oak Ridge, investing $313 million and adding 620 jobs.
Note: This story was last updated at 7:05 p.m.
Seeking to clarify its plans, CVMR on Friday said it still hopes to build a metal refining facility in Oak Ridge to produce metal powders and “nano materials.” That investment, to be completed in three phases, could cost more than $300 million in the first phase and eventually employ 1,200 to 1,500 engineers and technicians, the company said Friday.
But they will not establish a Center of Excellence focused on research and development of the application of vapor metallurgy technology to an expanding group of elements, CVMR said in a Friday letter to Tennessee Governor Bill Haslam.
The company sought to publicly clarify its position after news stories this week suggested that the CVMR deal was dead. Some officials and developers had pushed back after those stories appeared in several Knoxville media outlets, saying they remained “cautiously optimistic” that the company could still come to Oak Ridge.
On Friday, Kamran Khozan, chairman and chief executive officer of CVMR (USA) Incorporated, told Haslam that the company’s original proposal was two-fold.
First, CVMR, which manufactures high-purity metal powders and super alloys, planned to establish the Center of Excellence. It was to primarily focus on research and development in conjunction with Oak Ridge National Laboratory and the University of Tennessee, and to help train new employees. It was not expected to generate substantial revenue.
But in September, CVMR told Randy Boyd, commissioner of Tennessee Economic and Community Development, that this part of the proposal was “based on a misunderstanding of the degree and nature of the support that was offered by the State of Tennessee to establish the Center of Excellence.
“Based on this realization, we concluded that it was not feasible to proceed at that time with the establishment of the Center of Excellence and that CVMR research and development…and the application of vapor metallurgy, in conjunction with ORNL, would continue to be conducted at our facility in Toronto.”
But the other part of the company’s proposal was to establish, in three phases, the metal refining facility in Oak Ridge. It could expand substantially over six years to employ more than 1,000 engineers and technicians, Khozan said.
“As we advised Commissioner Boyd last September, we hope that we will be able to establish this facility in Oak Ridge,” Khozan said.
He said CVMR is revising the structure of its proposal to establish the facility and is engaged in discussions with suppliers of raw materials and equipment. The company’s design team is working to finish the construction parameters for the next three phases of its plan, Khozan said.
“We hope that this amended plan will be completed within the next six months and that it will receive the same degree of support and encouragement from the State of Tennessee, the City of Oak Ridge, and Roane County,” Khozan said.
Read Khozan’s letter to Haslam here:Â CVMR Letter to Governor Haslam 4 12 2015.
The City of Oak Ridge also released a statement regarding the CVMR clarification.
“Due to recent articles, we are pleased to receive confirmation from CVMR of their continuing intent to locate major manufacturing and engineering facilities in Oak Ridge and the East Tennessee region,” City Manager Mark Watson said. “We look forward to welcoming and working with them on this successful project in the near future.”
“We know there continue to be conversations with the company,” said Parker Hardy, president of the Oak Ridge Chamber of Commerce.
“Our interaction with them has been very positive at the local level,” said Steve Jones, a consultant for the City of Oak Ridge. “But we also understand that confidentiality is very important for new companies as they get set up and pick out their locations.”
Roane County Executive Ron Woody had pointed out that Jones and Wade Creswell, president of The Roane Alliance, continued to talk to CVMR about investments in the area. Both Jones and Creswell, along with Tom Rogers at ORNL, had received special credit at the March announcement of CVMR’s plans to move company headquarters from Toronto to Oak Ridge.
Still, he’d like to see some movement at the site, Woody said.
“The further you get away from a ribbon-cutting, the more risky the projects become,” Woody said.
But earlier this week, he had said that there could be news from CVMR soon.
State officials said $12 million was included in a capital projects grant passed in the last session of the Tennessee General Assembly as part of a budget supplement. So far, no incentive money has been spent, said Clint Brewer, assistant commissioner for communications and marketing in the Tennessee Department of Economic and Community Development.
He said CVMR received an incentive offer from the state that the company initially accepted, prompting the announcement of their planned relocation earlier this year.
The company’s March announcement is one of the largest non-federal industrial announcements ever made in Oak Ridge. The last one on a comparable scale was when USEC, which is now Centrus Energy, announced a roughly $100 million investment at the former Boeing building in south-central Oak Ridge in 2007.
CVMR announced in March of this year that it was moving its operations to Oak Ridge from Toronto, Canada, and investing $313 million here and creating 620 jobs. The Friday announcement of 1,200 to 1,500 potential jobs doubled or more than doubled the employment estimate.
In March, CVMR, which has operations in 18 countries, said it planned to use the former Theragenics building at Horizon Center in west Oak Ridge for its headquarters and research and development. It’s not clear if that building would still be used.
CVMR planned to put 218 people to work right away in its new headquarters and add 402 high-paying manufacturing jobs later, Boyd said at the time.
“I can promise you that this is the start of a wave,†Boyd said in March.
Tennessee Governor Bill Haslam, right, was among those who spoke at the March CVMR announcement. Also pictured from left are CVMR President Michael Hargett and Chairman and Chief Executive Officer Kamran Khozan, Oak Ridge Mayor Warren Gooch, Congressman Chuck Fleischmann, and (partially obscured) Randy Boyd, commissioner of Tennessee Economic and Community Development.
CVMR said then that the manufacturing facility could be built about two miles away on 25 acres at an old steam plant near the former K-25 site, now known as Heritage Center. That property is owned by the U.S. Department of Energy.
“This is obviously an exciting announcement for Oak Ridge and East Tennessee,†Haslam said at the announcement.
Ores concentrated overseas in places such as the Phillipines, Indonesia, and African countries were expected to be shipped or sent by barge to Oak Ridge, where they would be processed.
CVMR USA President Michael Hargett said the company had commitments to manufacture by June 2015, and the company planned to begin operating by the end of May 2015. Systems and equipment that are now in Toronto would be moved to Oak Ridge, Hargett said.
But residents began to raise questions when there was no sign of work at the former Theragenics building months later.
There were reports this summer that a company executive had purchased a home in Oak Ridge, but government officials in Canada were trying to keep CVMR there.
The U.S. Department of Defense is CVMR’s largest customer. Others include NASA, General Electric, and General Dynamics.
CVMR uses ore concentrates to create pure metal powders. Those then go to manufacturers that make parts for customers, such as NASA and DOD. CVMR works with 52 metal powders and metal concentrates such as nickel, iron, and cobalt, and it produces about 34 unique products that can be used in batteries, 3D manufacturing, medical instruments, defense equipment, and the aerospace industry.
A state press release in March said a large part of the U.S. plant will be used to produce metal powders for 3D printing and graphene for advanced products.
More information will be added as it becomes available.
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Matt Bailey says
Let’s see if I have this straight. Mr. Fowler in the KNS wrote an article leading us to believe the project was dead, completely dead, no life whatsoever. Then, he wrote an article yesterday seemingly trying to backtrack a bit. You would think the editor of the KNS would tire of Bob consistently writing articles that appear to be less than fully researched in an apparent attempt to be first to get the story out. Unfortunately, many of the KNS stories that are usually poorly researched seem to reflect negatively on our city. But then, if it was positive, a certain group of folks wouldn’t be able to whine and complain about Oak Ridge.
Today, John has apparently researched this story more completely and, as usual, there appears to be another side of the story. Thanks John for your professional approach. Whether the story is positive or negative, I appreciate your efforts to more fully research stores and give us a more complete overview.
Again, to you complainers who live here, I say this: Oak Ridge has a bunch of vacancies on various boards that need to be filled. Please consider being part of the solution. If your work and family allows you the time to go online and delight in kicking those who are trying to make life better, surely you can consider a more positive approach. You demand it of your children, students, athletes, coaches, etc. How about it?
Onslow West says
Regarding the vacancies on various boards…A few years ago, when I was living in Oak Ridge, a friend of mine applied for a vacancy on one of the city boards, a position for which he was eminently qualified. As a matter of fact, I would venture that his resume, submitted with his application, would have positioned him as one of the most qualified persons to ever serve on that board. And yet he received nary a vote from council when the appointments were made. When he later inquired as to why other less qualified folks were appointed, only two council members responded. One was quite frank in their assessment – council members spend little if any time looking through the applications, preferring instead to simply vote for people they know.
So maybe, just maybe, the shortage of applicants – if there is one – is more related to inattention on the part of council rather than apathy on the part of qualified citizens.
Matt Bailey says
A shame, yes. But you seem to be questioning the shortage,and yes, it was discussed by the City Manager recently, so yes, there is one.
You’re aware that we’ve had an election in the past 12 months here, so let’s hope that our current council would be more attentive. Mistakes happen. Council members get a whopping $150 per month. It’s a thankless job. Recently, they met on a Saturday for a work session, which doesn’t seem to fit the definition of a “good time”. Again, my point is this: Your example is one person, and while unfortunate, I doubt it inhibited 500 others from applying. Which would be about 2% of our population. I would hope that this person would re-apply!
Raymond Charles Kircher says
Honest people with experience in those boards need not apply, Matt Bailey. Many of us already know you get on those boards by who you know, not for what you know about making this city better. Anyone who has a mindset and resources to return to Oak Ridge what is Oak Ridge are soon to be met by a competitor application for the seat who is “more popular”.
Raymond Charles Kircher says
And Chuck Fleischman is moving ORNL to Chattanooga because a better fit can be made there. Who are you to believe when cover up mode is on? I can only imagine what is in the deal now. Maybe, if any reporter would get their hands on that deal and tell us if we have a chance against the competing location in the S. Pacific, we would know the truth. Oakridgers are looking for the retail story of the trucks pulling up to the shuttered mall with garbage cans and machinery to start work on the 15th that was supposed to start the 10th the month before. And yes, if John puts out that story, you are going to have your people saying it isn’t true. If only the corruption in government would be corrected, then the lackluster private sector would start to build.
Will Smith says
Hope that you are diligently working on what you are going to say when the demolition starts.
Raymond Charles Kircher says
#CORTNFriendshipBell If this is any sign, we don’t have any friends behind those doors.
Joseph Lee says
The sky is not falling.
Thank you John for the update.