The trustee overseeing the former ASARCO smelter site this month sold off a portion of the property along Paisano Drive to raise cash as the custodial trust shifts its approach to marketing the 450-acre property that has sat idle for over a decade.
And even after a deal to sell the property to the University of Texas System fell through in 2020, the team marketing the ASARCO site still sees the University of Texas at El Paso as an ideal buyer of at least a portion of the property.
The ASARCO custodial trust, managed by trustee Roberto Puga, this month sold a 12-acre segment of the property along the Rio Grande across Paisano from the former main plant site.
“We wanted to keep the trust solvent, so we sold a couple of small parcels along Paisano,” Puga said in an interview with El Paso Matters.
The parcel the trustee recently sold will house an industrial stormwater pipe manufacturing business, next to a smaller portion of the property with a warehouse that Puga sold a year ago, he said.
Trying to successfully sell the former industrial property has been a “long slog,” Puga said, after a century of smelting left the site contaminated with lead and other heavy metals that took years to clean up. Whoever buys the property will have to pay for environmental upkeep going forward.
“We’re pushing forward. We would like to have a deal in the next year. But selling the property has been a challenge,” Puga said. UTEP “still has some interest. And we’ve been talking to some energy companies that might have an interest in a solar project. And then other companies that have interest in more of an industrial setting for the former plant site.”
Neither UTEP nor the UT System responded to questions about potentially reconsidering a purchase of at least a portion of the site.
The Smelter
The former ASARCO property is split up in roughly four different parcels, but the two main segments of the property are the former plant site itself, which has heavy restrictions on use and a property developer can’t put homes, schools or medical facilities there. The other main parcel, on the east side of I-10 across the freeway from the old plant site, is boxed in by Executive Center Boulevard to the north and UTEP to the east.
Puga said his team cleaned up the roughly 250-acre portion of the property next to UTEP to a higher standard, and a developer today could build housing there in addition to commercial uses, although the mountainous terrain means only around 60 acres are developable.
Until now, Puga said the trust had sought to sell the entire multi-parcel property to a single buyer, or to coordinated buyers at the same time. That way, the trust wouldn’t sell the cleaner portion of the property east of I-10 and then have the former plant site – which is more challenging to develop – go unsold.
But Puga said the trust is “re-looking at that strategy now, because it just hasn’t panned out for us.”
“We’re rethinking that and seeing if it makes sense to sell the good part next to UTEP at market price, and use what we get to improve the old main plant site as much as we can to make it more attractive to others,” he said.
The trust is seeking around $16 million for the entire 450-acre property. Puga said he would consider selling the less-restricted parcel abutting UTEP alone for around $10 million.
The custodial trust received $52 million to clean up the property from ASARCO back in 2009 after the company declared bankruptcy.
Puga said that cash sum was based on the assumption the smelter would continue operating after the cleanup. But the trust needed far more money to remediate the entire site enough to allow for future commercial or residential use, he said.
“Fortunately, for us, smelting is a pretty messy business. So there’s a lot of spillage of product,” he said. “Once all the buildings were taken down, we were able to access what had been left behind, and there was a lot of copper, gold and silver.”
For a short while after becoming the site’s trustee, Puga entered the world of international commodity trading. He said he raised $30 million by doing things like selling copper materials to companies in China, and leftover lead to car battery-makers in India. He said he raised another $2 million by selling an oxygen-producing machine that had been recently installed at the smelter to an Australian firm that shipped it to Namibia. Scrap metal, meanwhile, was recycled locally.
Even after raising millions of additional dollars, however, the trust still needs to use proceeds from a sale to complete the final remediation steps. Puga said the environmental cleanup work is 95% complete.
Any extra cash from a sale that’s leftover after the cleanup is finished would go to wind down the custodial trust and to compensate the Environmental Protection Agency and the Texas Commission on Environmental Quality, the regulators that have helped oversee the property for years with no compensation, Puga said.
“The bulk of the remediation work (including the installation of control systems) was completed in early 2017, with a few remaining areas requiring grading and placement of final cover systems,” a TCEQ spokesperson said in a statement. “Ongoing operation and maintenance of the control systems is required. All property sales require TCEQ and EPA approval, and all proceeds must be deposited into the trust account and used for site cleanup and maintenance.”
The EPA did not respond to a request for comment about the property and the sales process.
Chilly wind whipped through the former ASARCO plant site as Doug Solon, the technical manager of the property, led a tour on a recent afternoon.
The old ASARCO property sits just off the Interstate, but it’s quiet and mostly barren except for a couple of port-o-potties used by the border patrol agents who sit at the site and peer down onto the border and Ciudad Juarez. Signs remind the few passersby that there is still an active overhead electrical wire that powers a pump system to clear out stormwater from the site; border patrol agents have accidentally gotten their surveillance equipment tangled up in the power line before, Solon said.
Huge man-made mounds crop up throughout the property, which hold the contaminated soil and other material from the smelter underneath three-foot caps of clay, heavily compacted silt and gravel. Near the northern edge of the property, dozens of white-painted crosses dot the silent, dusty smeltertown cemetery, one of the few still-existing reminders that the site’s industrial history goes back to the 1880s.
A buyer of the property would have to continue taking samples to make sure that no contaminants are leaching into the groundwater. They would also have to finish “channelizing” a big arroyo that directs stormwater rushing down from the mountains through the property and down into the Rio Grande, Solon said.
Solon used to work at the ASARCO smelter beginning in the 1990s as an environmental project manager, before he became the onsite manager for the last 15 years. Solon agreed it was right to close the polluting smelter, but he said he would be comfortable today coming back to the old plant site to shop at a retail business.
“If retail comes in, they’re going to have to put down asphalt, they’re going to have to put down concrete foundations. At that point, nobody is going to be really exposed to any soils that have been contaminated,” Solon said.
“You’re going to have to assume the liability. But it’s doable. It’s taking groundwater samples and managing the flow of this stormwater,” he said. “But that’s what consultants are for.”
When the UT System in 2020 pulled out of a deal – which had been in the works since 2016 – to purchase the full property for just under $17 million, it cited the fact UTEP would have had to pay $7 million additional dollars to fund the rest of the cleanup and ongoing environmental maintenance of the site. That’s part of the reason why Puga is now focused on marketing the cleaner, less-restricted parcel on the east side of I-10.
Ultimately, Puga said finding a buyer who can redevelop the land and recreate it as a property-tax paying site would be a “nice little legacy” for his career and firm, PathForward Consulting.
“I would like to have it so that there is kind of a public use, something where El Pasoans can feel like the site was resurrected from the dead. And then on ASARCO east, the area next to the university, I think it would be great if the university could expand. I think those would be two really good uses. Potentially also, on the main plant site, maybe a renewable energy project,” Puga said.
“Something that brings the property back into the 21st century,” he said. “I’ve just got to find the right buyer.”
