Like a lot of people who have followed the story of the proposed Minnesota Steel integrated mining and steel making facility near Nashwauk, I’ve been getting nervous. While officials were receiving assurances that the western Iron Range project would go forward as planned, we were all getting mixed signals as Minnesota Steel’s new parent company, Essar Global, bought up steel operations all over North America. Was this going to be an innovative new mine/steel plant or just another mine?

Today we are getting new assurances that Essar plans to build a steel plant. It will take a bit longer than originally hoped, but company officials are reassuring the press, legislators and local officials of the Iron Range that their original intentions have not changed. In addition, the company plans to be a fully involved owner of the plant — overseeing operations and management — which is also an encouraging sign.

From today’s Hibbing Daily Tribune:

Minnesota Steel gets ready to ‘dig in’

Officials expect steel slabs will be cast within five years
By Melissa Cox, Saturday, May 31, 2008

NASHWAUK — The Essar Group announced late Friday that the much-anticipated groundbreaking for Minnesota Steel’s integrated ore-to-steel plant is planned for this summer.

Ravi Ruia, vice chairman of The Essar Group, which owns Minnesota Steel, told state officials of the company’s plan for the groundbreaking and of Essar’s expectation that steel slabs will be cast at the plant within five years, according to a company news release.

“We are committed to moving as quickly as possible to bring steelmaking to the Iron Range,” Ruia said in the release. “Minnesota Steel plays a key role in our North American steel strategy.”

According to the company announcement, The Essar Group will provide all necessary technical, managerial and financial resources for the $1.65 billion iron ore mining, process and steelmaking plant.

The plant, located in Nashwauk, will be the first steelmaking facility located on the Mesabi Iron Range and the only facility in North America to include iron ore mining, ore processing, direct reduction and steelmaking at a single site.

Ruia told Sandy Layman, commissioner of Iron Range Resources (IRR), as well as Iron Range lawmakers, during a meeting today that he is looking forward to groundbreaking. He also said he hopes various development agreements with local governments and other partners are reached soon enough to meet the timeline for work on the project.

Those agreements deal with infrastructure for the project, such as utilities, a land exchange, a railroad spur and transportation routes.

Rep. Tom Anzelc, who represents the Nashwauk area and chairs a mining liaison subcommittee, responded to the announcement Friday by calling the project “the beginning of the rebirth of the western Mesabi Iron Range.” Anzelc, who also serves on the IRR board, said, “This is a complicated financial and construction project.” He advises people to be patient as the project moves forward.

“We in the public sector, we in government, have done virtually everything that has been asked of us,” including committing $28 million in bonding money, Anzelc said.

Construction of the mine, crusher, concentrator, pellet plant and tailings basin is expected to take approximately 30 months, with the direct reduced iron plant and slab steel casting facility to take an additional 29 months.

Essar has conducted a number of economic and technological feasibility studies since it finalized its purchase of Minnesota Steel last October.

The project has been moving forward. Equipment has been ordered and an international team of experts, that will be supplemented by local resources, has been retained to build the pellet plant, the company news release said.

Engineering firms have been retained to start work on various parts of the plant, and some construction projects are out for bid.

Minnesota Steel will create about 700 full-time jobs with an annual payroll of $60 million, according to Madhu S. Vuppuluri, president of Essar Americas. It will also generate 2,100 spin-off jobs with an estimated annual payroll of $100 million. Vuppuluri said the plant will contribute $18 million a year in taxes and royalties. There will be an estimated 2,000 construction jobs.

“The project is going to happen,” said Anzelc. “The future is bright and this gives our young people a chance.”

Melissa Cox can be reached at melissa.cox@mx3.com. To read this story and comment on it online go to www.hibbingmn.com

Again, there is no complete security until we see shovels in the ground, but it appears that rumors of a July groundbreaking are gaining credibility.