Smelterville

Crystal City forges one hell of a deal.

"I bought this thinking that maybe in twenty years it would pay off," says Kennedy. "Then in 2005 the price of iron ore increased 70 percent and we began looking at ways to open the mine sooner."

Kennedy believes the vein of metal below his Pea Ridge property contains enough reserves to annually mine 3 million tons of iron ore for 100 years. Once the mine is in operation, Kennedy plans to transport the raw iron ore to Crystal City, where it will be processed into pig iron and loaded onto barges. Kennedy estimates the smelter will eventually cost $1 billion and employ 650 people at wages up to $40 an hour.

And those are just the direct jobs associated with the smelter, posits Kennedy. "The indirect employment — from suppliers to transportation — could be five times that," he says. "This is going to be a tremendous investment in the community. You'd think people would be happy about that." Kennedy pins the source of the opposition squarely on Tom Kerr and what he describes as a tiny but vocal minority. "If I in any way thought the C4 group represented a small amount of Crystal City — even 10 percent — I'd have packed up and left a long time ago," says Kennedy.

Jack Ginnever's historic home could soon overlook an iron-ore smelter.
Jack Ginnever's historic home could soon overlook an iron-ore smelter.

Part of the problem, he concedes, is the Chinese investment in the project. Kennedy maintains that the relationship with Minmetals is strictly financial. Minmetals, a Fortune 500 firm, has the resources to provide the financing for the project but will have no ownership in the final project, says Kennedy. Instead, the company will demand a percentage of all iron ore processed at the smelter and sold to U.S. steel mills.

Kennedy takes particular umbrage at what he terms the "race-baiting" and "xenophobia" of people trying to stop the deal. This fall members of C4 contacted the Department of Homeland Security over concerns that the Chinese government would acquire an inland port as a result of the smelter. Kennedy says he's also heard comments about the rumored Middle Eastern ties of his wife, Nina Abboud, who's of Lebanese decent.

"You can't call Homeland Security screaming that the commies are coming," says an indignant Kennedy. "I mean, Red Communist China? Richard Nixon — he hunted commies for a living — he didn't even have a problem with them anymore."

In November, Tom Kerr presented Crystal City officials with more than 200 title exceptions his engineer discovered that could impact the sale of the PPG property. The engineer also identified what Kerr believes is firebrick scattered about the PPG property. Used as insulation in kilns and furnaces, firebrick can be a source of chromium-6 — the highly toxic element made famous in the 2000 film Erin Brockovich that starred Julia Roberts. (In the wake of the firebrick discovery at least two C4 members have sent the real-life Brockovich a letter soliciting her help. Brockovich has yet to respond.)

"This is fear-mongering, plain and simple," replies an exasperated Kennedy. "Tom Kerr is throwing money around like a drunken sailor. It's just a bunch of desperate attempts to derail this."

Kennedy says he's tried to keep the project under wraps out of fear that "speculators" the likes of Tom Kerr would attempt to purchase the PPG property and drive up the price. Yet Kennedy himself has teamed up with perhaps the most notorious real estate speculator in all of St. Louis in Dave Jump, who plans to build a train and barge depot on the PPG property. In the early 2000s Jump earned the reputation as the scourge of downtown St. Louis redevelopment efforts when he gobbled up scores of buildings on Washington Avenue and promptly placed them back on the market for double and triple what he paid. (See Randall Roberts' "Stranglehold," May 4, 2005.)

When the reclusive Jump dared show his face at a city council meeting last month, Jill Thomas and other C4 members assailed him with charges that his true intent is to build a massive ethanol refinery on the PPG property. "My only interest is in the railroads," says a bewildered Jump following the meeting. "Crystal City and the PPG property is the only place in the country where the Union Pacific and Burlington Northern Santa Fe railroads intersect within a few hundred yards of the Mississippi River. I've been interested in that property as a barge and rail hub since the 1970s."

Kennedy, meanwhile, labels Thomas' allegations about an ethanol refinery as just the latest in a series of "absurd and unfounded" notions connected to his project. "It's like the television show CSI meets Beavis and Butt-Head," comments Kennedy. "These people take a half-baked theory and draw a half-baked conclusion."

But if members of C4 can at times come across as a tad paranoid, so too can Kennedy, especially when hinting at the technology he plans to incorporate into the smelter. Kennedy talks of capturing the carbon-dioxide emissions from the plant and feeding it to algae that he will grow in "giant, petri dish-like tanks" on the site. "You end up with a plant that is 40 percent oil," says Kennedy. "You press it and you have diesel fuel."

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