Selling Asarco: Unexpected $18M boosts cleanup

By Robert Gray – El Paso Inc. staff writer

Photo by Melody Parra – A copper boulder worth $10,000 at the former Asarco site

It’s a monumental task: cleaning a property polluted by arsenic, cadmium, lead and other contaminants. But even harder might be selling the 410-acre former Asarco property, some local real estate experts say.

And that’s why the trustee overseeing the remediation and sale of the property says he is already reaching out to potential buyers, although the clean up won’t be complete until 2015.

“I want them to witness (the cleanup) and ask questions,” trustee Roberto Puga says. “It’s an iconic piece of property and that is why I am working hard to find a use that is worthy of this location.”

Puga, who has complete discretion over the sale of the property, says he is in talks with three potential buyers who are “serious,” although he won’t reveal who they are. He also isn’t disclosing the asking price but says it’s in the “low eight figures.”

Some, though, aren’t as optimistic as Puga.

“My personal assessment is that the liability associated with that site probably exceeds the asset value of the site,” says Gary Sapp, president of the Southwest Division of Hunt Development Group.

He added, “So, at the end of the day, it may be owned by the Environmental Protection Agency or the Texas Commission on Environmental Quality.”

Sapp has been involved in real estate in El Paso since the 1970s, and is also leading an effort to preserve the old Asarco smokestacks.

More money

The project is on a fast track with the demolition portion of the remediation 90 percent done. All that’s left are a few large tanks, the iconic 828-foot smokestack and a smaller stack. A group called Save the Stacks is attempting to preserve both stacks.

The trust overseeing the cleanup has made a bundle selling copper, lead, silver and gold left on the site by Asarco, which closed after a 2005 bankruptcy.

Puga says the $18 million earned from the sale of material, over and above the $52 million originally anticipated for the cleanup, will allow him to clean the property to a higher standard, making it more appealing to buyers.

The trust will clean the 170-acre piece of Asarco property west of Interstate 10, wedged between the Rio Grande and the highway, to a level that will allow the property to be used for light industrial, office buildings, research facilities or even retail, according to Puga.

As for the 240 acres east of I-10, wedged between Mesa Street, the interstate and the University of Texas at El Paso, Puga says he hopes it can be cleaned to a residential standard with some of the new money.

Right now the soil is being tested to see if it is possible and Puga says the results should be in by the end of the year, when all the data will be made available to the public.

“It is such a big question for us because, if we were able to make that residential, it would just make the property that much more attractive,” he says.

$10,000 boulder

Pieces from the copper smelter are now scattered around the world. In one typical transaction, copper from the site was sold to a Mexican company, which sold it to a Swiss metals broker, which shipped the ore to China, according to Puga.

Still sitting on the site is a deceptively inconspicuous dark brown boulder. It’s filled with copper and worth probably $10,000. Next to it are piles of black “matte,” filled with valuable metals. But dwarfing those piles are hills of dirt filled with dangerous levels of arsenic, cadmium and lead destined to be buried on the site.

By 2015 the dangerous materials should be buried in waste “cells” designed for hazardous material and a system installed to scrub stray arsenic out of water below the site.

The Parker Brothers Arroyo that runs through the site is being cleaned of slag and contaminated soil. Then it will be covered in concrete made to look like stone. Finally, a five-foot “cap” of soil placed over the 100 acres that served as the main smelter facility, according to Puga.

What about UTEP

City development director Mathew McElroy and others familiar with the project indicate that the University of Texas at El Paso might be interested in purchasing at least a piece of the former Asarco site.

“Any buyer who takes that on is going to be looking for any kind of public-private partnership,” McElroy says. He oversees planning, economic development, building permits and inspections for the city.

He added, “I have heard that UTEP could be interested in the site that abuts the Sun Bowl.”

Sapp says UTEP buying all or some of the former Asarco property could be a best-case scenario.

UTEP is pursuing status as a national research university, which requires expanding its research capacity and footprint, Sapp says. But the university is landlocked.

Asked if UTEP was considering purchasing the former Asarco property, a UTEP spokesperson told El Paso Inc., “There is nothing new to say.”

What if no one is willing to buy the property?

“That’s pretty unlikely given the interest I’ve been seeing,” Puga says. “But I don’t have to sell it. I can donate it or I can set aside money to have it fenced and lay empty for the rest of time.”