A new seven-year contract between Union Pacific Railroad and Rocky Mountain Steel means the Pueblo manufacturer will provide rails for Union Pacific Railroad’s train tracks when the new billion-dollar long rail mill in Pueblo officially fires up later this year. That’s according to a press release from the steelmaker. The agreement ends a legal dispute that began last year between the railroad and the mill over the cost of rails for train tracks.
The freight railroads Union Pacific and BNSF filed legal actions against the steelmaker after it was sold by Evraz to investment company Atlas Holdings, which currently operates the Pueblo steel mill as part of its Orion Steel Company. Rail shipments stopped in the fall according to the claim filed by BNSF.
“The new long-rail mill is a significant step forward in American manufacturing that supports Union Pacific’s focus on delivering safe, reliable service for our customers,” Jim Vena, CEO of Union Pacific said in a written statement. “As Union Pacific pursues its merger with Norfolk Southern to create the nation’s first transcontinental railroad, our ability to partner with Rocky Mountain Steel becomes even more critical as our merger is positioned to strengthen the nation’s manufacturing core as well as domestic job growth.”
The new plant in Pueblo will produce 328-foot-long rails that require 80 percent fewer welds than standard 80-foot rails, according to the company. It uses recycled steel and is powered by a 1,800-acre solar farm.
“This mill is an essential part of America’s steel transportation infrastructure, and its continued existence shows that our nation offers railroads large and small the very best product, made by the very best steelmakers in the world. I thank Union Pacific leadership for making that case crystal clear via this new long-term contract,” said Doug Matthews in a statement. He’s the CEO of Orion Steel, the parent company of Rocky Mountain Steel Mills.
The BNSF lawsuit is still pending.
“This contract agreement … will provide long-term certainty and stability for Pueblo steelworkers, the local economy, and domestic rail production,” Senator Michael Bennet said. He was integral in making the deal happen, according to a person familiar with the situation.
“I encourage all those involved in ongoing negotiations to reach a swift conclusion that ensures Pueblo continues to operate one of the most advanced mills in the world and is able to provide good paying jobs for Colorado workers,” he said.
