Visions - Fall 2007 - 6

Steel & Non-Ferrous Metal Group SCOA Steel & Non-Ferrous Group Enters Wind Energy Market Katana Summit, LLC: New Wind Turbine Tower Manufacturer A new partnership of Sumitomo Corporation of America and T. Bailey Inc. (through affiliate Katana Industries, Inc.) was formed to meet the ever-growing demand for wind energy structures by manufacturing wind towers in two dedicated facilities in the United States. With a projected output of over 400 wind towers per year, the venture hopes to achieve its vision of meeting renewable energy demands in the Midwest and Northwest market while expanding the supply potential for wind energy nationally and internationally. Senior Vice President Tom Kaji and Neal Suess, President/CEO of Loup Power District, speak at the groundbreaking ceremony of the new Katana Summit manufacturing plant in Columbus, Nebraska. The joint venture, Katana Summit, LLC, currently operates one manufacturing plant in Ephrata,WA, and is constructing a new facility in Columbus, NE. Production at the Ephrata plant began in May of this year.The Columbus plant will employ nearly 180 workers and is scheduled to begin manufacturing in May 2008. The venture reflects a joint contribution by SCOA and Sumitomo Corporation of 50% capital contribution, with T. Bailey supplying the other 50%. An Anacortes, WA-based manufacturer of steel tanks,T. Bailey has six years of experience in manufacturing towers that rise as high as 100 meters. Growing Strength of Wind Energy Market According to SCOA Railroad Forging and Casting unit in Chicago, total investment on the project will reach nearly $40 million, with annual expected sales of over $300 million in three years. SCOA also believes that demand will increase steadily, projecting an increased demand of over 3,000 towers per year. SCOA will be supplying the flat rolled steel plates which are used to manufacture the towers. International sales of wind turbines are increasing yearly, and a total of nearly 100,000 wind turbine generators have already been sold. The United States held the #2 position for cumulative market share by the end of 2006. These figures indicate that the market for wind energy delivery systems continues to grow exponentially. “We are delighted to partner with Sumitomo to form the new venture,” said Darrell Lehmann, President and CEO of Katana Summit.“It will position Katana Summit 6 visions Fall 2007 as a leading supplier of wind turbine towers.We are excited about the opportunity to increase our market share and further expand. I look forward, with Sumitomo’s assistance, to creating a substantial commercial portfolio over the next five to ten years, creating value for both parties.” Toshihiko Kaji, SVP and GM of SCOA’s Steel & NonFerrous Metal Group, said,“We are pleased to partner with Katana Industries’ experienced management team, who since 2001 have developed a well-respected track record of efficiently manufacturing quality wind towers at the Ephrata,WA facility.We believe that we could not have found better managers with whom to partner to prepare for the changing trends of the North American renewable energy marketplace.” A New Generation of Wind Power Wind power generation supplies only approximately 0.5% of the U.S.’s current electric power supply, an amount considerably smaller than European counterparts: Spain (5%),

Visions - Fall 2007

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