Copper is the new gold in Sealy.
A Chinese-based company that manufactures pipes, tubing and other products out of copper has purchased the former BAE Systems facility and will build a new 500,000-square-foot building and invest $165 million in the project.
Hailiang Copper Texas, Inc., purchased the 200-acre site from Five Star Properties on Oct. 9 and will operate a new facility that produces copper water pipes, coils, refrigerating air conditioning pipes, insulation pipes, and other conduits, according to the company.
Hailiang spokesperson Michael Jiang said the company is making a $165 million investment that includes fixed assets and equipment worth $134 million and $30 million in working capital. The company is expected to bring 250 jobs to Sealy, phased in over the next few years.
“This means growth and prosperity,” Sealy City manager Lloyd Merrell said. “A $165 million plant is going to be a real shot in the arm for the local economy. They’ll be using a lot of local people to get that plant up and running.”
The closure of the BAE Systems plant in Sealy five years ago was a huge economic blow to the city and Austin County. Other than the portion that is leased by SNC Lavalin, the remainder of the old plant is still available to lease.
“The old BAE property is open and available for someone to lease,” Merrell said.
Originally company officials indicated that they would bring over 400 jobs to the site, but that number was reduced to 250 through the use of robotics. Merrell estimated that it will be the middle of 2020 before any hiring takes place.
In order to make the deal happen, Hailiang was provided tax incentives that includes a seven-year tax abatement from Sealy, an abatement offer from Austin County that has not yet been signed, and a Section 313 Value Limitation Agreement with the Sealy Independent School District, which limits property tax increases on their property.
Merrell said the company will receive a 100 percent abatement the first two years, then dropping 10 percent each year through the seventh year.
According to the Section 313 Value Limitation Agreement prepared by attorney Mike Fry between Sealy ISD and Hailiang, “The approval of this agreement would undoubtedly prove beneficial to the economic development of Austin County, as well as the viability of Hailiang Copper Texas, Inc. to be located within the state of Texas.”
The agreement was signed Nov. 28 by Ryan Reichardt, president of the Sealy ISD Board of Trustees. The agreement was approved June 5 by the state comptroller.
According to the agreement, “Hailiang Copper Texas, Inc is a part of Hailiang America Corporation – the U.S. Division of China Hailiang Group. Hailiang America is a leader in the copper and brass manufacturing industry. They are dedicated to producing high quality products fully certified to industry standards. Additionally, they are committed to promoting positive stakeholder relationships in the communities they choose to invest and are managed by a team of individuals with years of experience in developing and managing manufacturing facilities.
“Hailiang Copper Texas, INC will be managed and developed by Hailiang America Corporation. Hailiang America Corporation serves as the U.S. Division of the China Hailiang Group—a national supplier of copper and brass tubular and fitting products. Founded in 1989, Hailiang America Corporation is headquartered in Leesport, Pennsylvania, with manufacturing facilities around the United States.”
In the agreement, the company outlined what would be happening at the facility:
Summary of Production Process
The initial stages of production begin with special-grade or grade-one electrolytic tough pitch copper with high purity and low impurity contents. Most of this copper is sourced from mines throughout China, Mexico, South America, and the southwestern United States.
Due to the chemical properties of copper, it is highly valued for use in areas where anti-corrosion, machinability, and efficient heat transfer are imperative. Once the special grade copper reaches the manufacturing facility it then undergoes a series of processes until the finished product, copper tubing is available for sale and distribution.
The initial manufacturing begins with the melting of the copper. Typically this is conducted in a horizontal casting furnace. These furnaces are combined furnaces with metal flowing beneath the surface, a crystallizer, a cooling water distribution system, a servo control withdrawal system, an in-line synchronous saw, a saw for mold changing, a hydraulic system, and an electric control. Once ultra-high temperatures melt the copper it is then transferred to the sawing station.
Sawing, Milling, Rolling, Combined Drawing Line
Through the process of sawing, milling, and rolling the melted copper is then transformed into a tubular structure. Combined drawing machines then middle the copper to specified diameters where it is then ready for the next steps in the manufacturing process.
Once the copper tubing reaches the spinner block, the final dimensions of the pipe are established and created through an outside die and inner floating plug.
Once the copper tubing diameters and dimensions have been finalized, the annealing process begins. Essentially the purpose of annealing is to remove stress and return the copper tubing to a workable state. The process of annealing occurs through the reheating of materials above their respective crystallization temperature. This temperature is then held until previous thermal histories are removed. After the product is cooled, the materials are then elongated and made uniform without tarnishing, resulting in a more refined, malleable product.
Internal Thread Forming and Winding
Once the internal threads have been created the copper tubing is then fed through a winding machine which simply rounds the tubes onto circular wheels for easier distribution.
The last step in the manufacturing process occurs in the final annealing of the copper tubing which essentially is a safeguard to ensure a zero-chip, and tarnish free product through a reheating of the tubing after placement on spools.
In the internal thread forming process, internal thread rolling heads carve specified threads in the wire. This occurs through cold forming technology which eliminates chip-removal problems and ensures accurate thread sizes for gage limits.