ST. LOUIS, Feb. 1 /PRNewswire/ -- Rebuilding the upper reservoir of the AmerenUE Taum Sauk pumped-storage hydroelectric plant, which is estimated to cost $450 million, is expected to add 635 new jobs to the state's economy, while raising state income by $48 million, a study conducted by the Center for Economic & Business Research at Southeast Missouri State University shows.
Serving as an engine for economic growth for Missouri, the two-year reconstruction of the upper reservoir that was destroyed by a Dec. 14, 2005, breach, will directly benefit Iron, Madison, Reynolds, St. Francois and Wayne Counties in Southeast Missouri but will have a favorable impact across the state. Of the estimated 300 people expected to be employed to rebuild the facility, 177 will be from a 10-county region within Missouri and will earn approximately $17 million annually for each of the projected two years of the rebuild. The spending by these contract employees is expected to add an additional $5 million of income and another 95 jobs in this 10-county region.
The spending by all 300 contract employees is expected to lead to increased employment and income in other economic sectors, with estimates that this spending will create an additional 248 jobs in the state. Therefore, the total number of new jobs added to state employment rolls by the project is expected to stand at 548, creating approximately $43 million in additional income. Added to these 548 new jobs are the jobs expected to result from construction spending of about $5.25 million in each of the projected two years of the rebuild, adding another 87 jobs. Completed in early 2008, the full economic impact study of this major construction project can be found at http://www.ameren.com/taumsauk/.
The rebuild comes almost two years after the Dec. 14, 2005, breach in the plant's upper reservoir caused significant flooding in the Johnson's Shut-Ins State Park. The upper reservoir will be constructed with roller compacted concrete (RCC); once rebuilt, this 54.5-acre reservoir will be the largest RCC dam in North America.
In August 2007, AmerenUE received approval from the Federal Energy Regulatory Commission to rebuild the upper reservoir, and in early November, the company announced it had engaged Ozark Constructors, LLC, to rebuild the reservoir. Ozark Constructors is a venture partnership formed by Colorado-based ASI Constructors, Inc., and St. Louis-based Fred Weber, Inc. AmerenUE also announced that Paul Rizzo Associates, Inc., based in Pennsylvania, was selected engineer of record and project manager. RIZZO is a world-recognized engineering and construction management firm for dams. Since the company first announced its intent to rebuild in early 2007, AmerenUE has stressed that the reservoir would be rebuilt following criteria used in current dam design and construction practice. Insurance is expected to cover substantially all the costs of the rebuild.
AmerenUE is a subsidiary of St. Louis-based Ameren Corporation (NYSE: AEE). Ameren companies serve 2.4 million electric customers and nearly one million natural gas customers over a 64,000-square-mile area of Missouri and Illinois. Built in 1963, AmerenUE's Taum Sauk Plant, as a pumped-storage hydroelectric plant, stored water from the Black River in the upper reservoir atop a mountain and released the water to generate electricity when power was needed.
Statements in this press release not based on historical facts are considered "forward-looking" and, accordingly, involve risks and uncertainties that could cause actual results to differ materially from those discussed. Although such forward-looking statements have been made in good faith and are based on reasonable assumptions, there is no assurance that the expected results will be achieved. These statements include (without limitation) statements as to future expectations, beliefs, plans, strategies, objectives, events, conditions, and financial performance. In connection with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we are providing this cautionary statement to identify important factors that could cause actual results to differ materially from those anticipated. The following factors, in addition to those discussed elsewhere in this release and in our filings with the Securities and Exchange Commission, could cause actual results to differ materially from management expectations suggested in such forward-looking statements:
-- regulatory or legislative actions, including changes in regulatory policies and ratemaking determinations; -- changes in laws and other governmental actions, including monetary and fiscal policies; -- costs associated with AmerenUE's Taum Sauk pumped-storage hydroelectric plant incident, including rebuilding costs; -- recoverability through insurance of costs associated with the Taum Sauk pumped-storage hydroelectric plant incident; and -- legal and administrative proceedings.
Given these uncertainties, undue reliance should not be placed on these forward-looking statements. Except to the extent required by the federal securities laws, we undertake no obligation to update or revise publicly any forward-looking statements to reflect new information or future events.
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