Boondoggle Monday

Today the Iron Range Resources Board meets to discuss extending the deadline for the $9.5 million in loans to Excelsior Energy for its Mesaba Energy Project. The Mesaba Project is a $2.1 billion (probably more) coal gasification power plant proposed for Itasca County and/or Hoyt Lakes.

I have, at times impolitely, called for this project’s purge from the lexicon of serious economic development discussion on the Iron Range. I have long maintained that there is no way this thing gets a customer, substantial private investment or permits. I won’t list the whole works here, but this project is just loaded with problems and exists solely because a very short list of elected officials have poured every dime of state and federal money they could find into the pockets of the lobbyists and lawyers running Excelsior Energy. Their efforts have yet to produce a customer for this overpriced power, permits for this uncertain technology or private investment in this unproven company.

Nevertheless, I expect the board will extend the loan for one or two years. They will use the logic that calling in the notes now would ensure Excelsior’s immediate bankruptcy. This is true. But by extending the loan, Excelsior will use the time to hunt for more federal money and permitting favors to continue its never ending quest to ram a white elephant down the throats of the energy industry. There is still no statistical likelihood they will succeed. The good economy in which investment might have been found is gone. Excelsior was born of desperation during a bad economy in 2001 and will die with a whimper during another bad economy.

The Iron Range’s greatest economic development hopes lie elsewhere. Let’s dig someplace new.

Comments

  1. Coal is one of our most abundant natural resources; only a fool would want to bankrupt the coal industry at a time when energy independence is so important to our national security.

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