Energy Surcharge Statement For May 2019
Energy Surcharge Implementation – May Update
Dear Valued Customer:
Since October 2018, Natural Gas prices to our Western Operations have been high and volatile. As you most likely have heard, this was caused by a catastrophic explosion to one of our main natural gas sources, the Sumas Canadian Pipeline Enbridge. The repair process to get this line back to normal operation was long and painful resulting in massive amounts of extra costs.
We implemented an Energy Surcharge in December to begin addressing these costs. Our Energy Surcharge Policy stated that a $42/ton Energy Surcharge was appropriate for this time period. However, in order to keep the impact on you as minimal as possible, we determined to lower the Energy Surcharge to $21/ton for our Lovelock, NV and Vale, OR facilities and $12/ton for products shipping from our Clark, NV facility. We may also have to continue to charge an Energy Surcharge when pricing exceeds $4.40/dTh, or is absolutely necessary because of outside circumstances beyond our control.
As we move forward into May, we must continue the current surcharges as stated above. We hope you understand that while we have only passed along a portion of the Energy Surcharge, we do need to continue this beyond the October-April crisis period. We continue to work to minimize the impact on you and have taken several actions to do so. We are nearing the end of this extreme situation and will have our next update at the end of the month.
We thank you for your business and support during this difficult time.
Vice President, Global Sales & Marketing