Construction at Essar Steel near Nashwauk, Minnesota, as seen May 2015. (Aaron J. Brown)
Today, Chippewa Capital Partners is expected to get its final green light from a bankruptcy court in Delaware. This allows the partnership to take over the former Essar Steel Minnesota iron ore mine near Nashwauk.
But the company also celebrates equally good news right here in Minnesota. Gov. Mark Dayton and the state Department of Natural Resources reached an agreement with the new company for mineral leases that had been granted to the failed Essar group.
This, according to a John Myers story in today’s Duluth News Tribune.
The Chippewa group consists of Roanoke, Va., billionaire Tom Clarke and London-based GFG Alliance, an international steelmaker with ties to electric arc furnace steel mills.
That’s where the news becomes highly relevant to the future of Iron Range mining. This could transpire into what was originally promised: value-added iron production at the site of the iron mine.
From Myers’s story:
Clarke, who also purchased most of the bankrupt Magnetation Iron Range mining and processing operations in December, has vowed to add a major new element to the Nashwauk project — an iron plant that would turn taconite concentrate produced at the site into hot briquette iron. That iron would be used in electric arc mini-mill steel mills, the first big push for Minnesota iron ore into that growing steelmaking market.
Dayton had steadfastly refused to release the state’s rights to minerals under about 30 percent of the Nashwauk mine site, now called Mesabi Metallics, saying he wanted a better deal for local contractors and vendors who are still owed millions by Essar. He also wanted better guarantees that the new company has the financial backing to finish the project that’s been underway since 2008 without producing an ounce of taconite.
Dayton told the News Tribune on Monday that he’s “very hopeful” the agreement will lead not just to some past debts being paid but also an all-new taconite facility that will employ hundreds of Iron Range residents and put more money in state coffers. Most importantly, the governor said, is that the new operation will use the taconite to produce hot briquette iron, a move considered critical for the future of Iron Range mining.
Promises come easy for this project, but results transpire very slowly. Nevertheless, if this new company — still in its naissant form — actually launches as promised, it will have a huge, unpredictable impact on the Iron Range mining industry.
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