Foreign-Trade Zone 104-Savannah, GA Application for Manufacturing Authority Mitsubishi Power Systems Americas, Inc. (Power Generation Turbine Components) Pooler, GA

An application has been submitted to the Foreign-Trade Zones Board (the Board) by the Savannah Airport Commission, grantee of FTZ 104, requesting manufacturing authority on behalf of Mitsubishi Power Systems Americas, Inc. (MPSA), located in Pooler, Georgia. The application was submitted pursuant to the provisions of the Foreign-Trade Zones Act, as amended (19 U.S.C. 81a-81u), and the regulations of the Board (15 CFR part 400). It was formally filed on September 13, 2010.

The MPSA facility (“Savannah Machinery Works”, 119 acres/239,000 sq. ft.) is located at 1000 Pine Meadow Drive within the Pooler Megasite (proposed Site 12 under pending FTZ 104 ASF/Reorganization, Docket 51-2010 [75 FR 53637, 9-1-2010]) in Pooler (Chatham County), Georgia. The facility (approximately 500 employees), currently under construction, will be used to manufacture and repair large gas and steam power generation turbine components (combustor baskets, transition pieces; up to 1,500 units of each per year) for export and the domestic market. Activity would involve receiving foreign-origin, semi-finished nickel alloy sheets, bars, castings and forgings (HTSUS Subheadings 7506.20, 7508.90; duty rate: 3.0%; representing about 36% of total material value) that would be machined, welded, balanced and thermal coated to produce finished gas turbine combustor baskets and transition pieces. Some 70 percent of the finished combustor baskets and transition pieces will be exported. The proposed activity under FTZ procedures would also involve service maintenance and repair (e.g., dis/assembly, inspection, cleaning, upgrading, welding, and balancing) of customer-owned gas and steam turbine components (rotors, valves, blades, gears, couplings, airfoils, hubs and stationaries) and generators. Foreign-origin turbines and generators would also be distributed from the MPSA facility. The application indicates that large gas and steam turbines will be manufactured at the facility in the future, but MPSA is not seeking authority to produce these products under FTZ procedures at this time.

FTZ procedures could exempt MPSA from customs duty payments on foreign materials and components used in export production. On its domestic shipments, MPSA would be able to choose the duty rate that applies to finished gas turbine combustor baskets and transition pieces (2.4%) for the foreign nickel alloy inputs noted above. MPSA would also be exempt from duty payments on any foreign-origin nickel alloy that becomes scrap or waste during manufacturing. Duties also could possibly be deferred or reduced on foreign status production equipment. Customs duties could be reduced on foreign-origin turbines (6.7%) that may be withdrawn from the zone with generators for customs entry as complete generating sets (2.5%). FTZ procedures would further allow MPSA to realize logistical benefits through the use of weekly customs entry procedures. The application indicates that the savings from FTZ procedures would help improve the facility's international competitiveness.

In accordance with the Board's regulations, Pierre Duy of the FTZ Staff is designated examiner to evaluate and analyze the facts and information presented in the application and case record and to report findings and recommendations to the Board.

Public comment is invited from interested parties. Submissions (original and 3 copies) shall be addressed to the Board's Executive Secretary at the following address: Office of the Executive Secretary, Room 2111, U.S. Department of Commerce, 1401 Constitution Avenue, NW., Washington, DC 20230-0002. The closing period for receipt of comments is November 16, 2010. Rebuttal comments in response to material submitted during the foregoing period may be submitted during the subsequent 15-day period to December 1, 2010.

A copy of the application will be available for public inspection at the Office of the Foreign-Trade Zones Board's Executive Secretary at the address listed above and in the “Reading Room” section of the Board's Web site, which is accessible via http://www.trade.gov/ftz. For further information, contact Pierre Duy at Pierre.Duy@trade.gov or (202) 482-1378.