Hawaiian Cement plant
closing in 2 years

The plans are revealed as the firm's
50% owner buys out its partner

By Russ Lynch
Star-Bulletin

A North Dakota company says it will become sole owner of Hawaiian Cement Co. and plans to close the company's 200-employee cement factory at Barbers Point within two years.

Knife River Corp.'s plans call for Hawaiian Cement to cease making cement and instead become an importer and distributor of cement made outside Hawaii, John DeLong, Hawaiian Cement president, said today.

In the ownership shift, Adelaide Brighton Ltd., the South Australian owner of 50 percent of the company, said it has agreed to sell its partnership interest for $25.8 million to Knife River, a subsidiary of MDU Resources Group Inc. in Brunswick, N.D.

Knife River already holds a half-interest, purchased in September 1995 from Lone Star Industries Inc.

Dan Sharp, a Knife River spokesman, said today that his company would not disclose what it will pay for the other half, but the Australian seller listed the price in a statement.

Sharp also referred questions about Hawaiian Cement's future to DeLong. DeLong said it is a fact of life that manufacturing anything in Hawaii is expensive.

Instead, Hawaiian Cement wants to build a $15 million bulk cement receiving and storage facility on the waterfront, either at Barbers Point or at an existing facility at Pier 34, he said.

It would have a bagging plant to pack cement for local distribution. "We have mixed feelings about it. It means exporting Hawaii jobs oversees," he said.

He said moving away from a 50-50 partnership will make decision-making easier and let the company go ahead with changes. Given all the permits and other requirements, it probably would take a couple of years to create the new facility, DeLong said.

At the height of the construction boom of the early 1980s, Hawaii had two cement factories, Hawaiian Cement and a Kaiser Cement plant at Nanakuli.

In 1985, Kaiser sold the Nanakuli plant to Lone Star which closed it and consolidated the business into one operation at Barbers Point. At one time Hawaiian sent had as many as 300 employees but the construction drop-off in the last few years led it to trim by about one-third.

Knife River's parent MDU is a public company with some 2,400 employees in mining, natural gas pipeline operations and oil and gas development. It mines aggregate on the West Coast and produces construction materials in Alaska, California, Oregon and Hawaii and has coal mines in North Dakota and Montana. The company had revenues of $140 million last year.