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Port Authority board approves sale of IP property
Port wants new owner, Berg Pipe, to be able to move quickly should Mobile site be chosen for plant
Wednesday, February 28, 2007By KAIJA WILKINSON Business Reporter
The Alabama State Port Authority agreed Tuesday to sell about 86 acres at the former International Paper site in north Mobile to Berg Steel Pipe Corp. of Panama City, Fla., a deal contingent on the company's choice of Mobile for an $80 million steel pipe plant that's projected to create about 130 jobs over three years.

Jimmy Lyons, port authority director, proposed the sale for $34,000 an acre, or $2.9 million, and the authority accepted that recommendation.

Dave Delie, Berg's president and chief executive officer, said the company is entering the home stretch in its site selection process and expects to make an announcement by mid-March. An unspecified site in Louisiana is also under consideration, he said.

But Berg is now negotiating just "a couple of open items" with Mobile and Alabama, Delie said, indicating that Mobile would be the choice should those issues be resolved. He would not say what the items were.

Judy Adams, port authority spokeswoman, said the port is cautiously optimistic that it will land Berg, a company it has been in talks with for about five years.

But, she said, "this is not a done deal. We are not taking this for granted."

The Port Authority in 2004 completed the purchase of a 182-acre tract once used by International Paper. The authority paid $1.6 million for 96 acres; it had reclaimed the rest after IP canceled its long-term lease.

Berg Pipe representatives have visited the site many times to "kick the tires," Adams said. Lyons said the company is doing its own environmental review as well, which is normal, he said.

"We like Mobile," Delie said, "but we need to make sure we go into this with our eyes wide open , and that's what we're in the process of doing -- conducting our due diligence."

Should Berg decide on Mobile, the company plans to break ground sometime in late April, and have the plant operational by summer 2008.

The site has the rail and water access required by the company, and the Mobile Industrial Development Board in December 2006 approved a

$5 million package of tax incentives for the project.

The average salary for the Berg Pipe jobs would be about $53,000.

Whatever Berg's decision, Delie said the company is anxious to get started.

"We are just very excited about moving forward with the project," he said. "The large diameter pipe market is very strong right now, and we want to get this project online as quickly as we can."

Also on Tuesday, the Port Authority learned that more than $10 million in federal Department of Transportation funding will be released for use at the Mobile Container Terminal and Alabama State Docks Intermodal Facility at Choctaw Point.

U.S. Sen. Richard Shelby, R-Tuscaloosa, a member of the Senate appropriations committee, announced the release of the money, part of $20 million earmarked for the project in the fiscal 2006 highway mass transit funding bill.

"We are very pleased to see the money released and appropriated so we can continue our progress on the project," Lyons said. "It will help us very much."

The $300 million facility is anticipated to come online in early to mid 2008.