Another delay gives the Range some time to think

Several outlets, including the Duluth News-Tribune, report delays to the Essar Steel Minnesota plant outside Nashwauk on northern Minnesota’s Iron Range. Essar has cleared the site but because of changes to the original plan the company now must refile its Environmental Impact Statement to amend its permits. Overly optimistic predictions of production in 2011 are now being amended to 2015.

Essar’s public statements unflinchingly declare that this project will include both a mine with production plant AND a steel plant that harnesses efficient technology to make slab steel on site. However, the company’s actions and estimates, coupled with its ownership and plans of the Algoma facility near Sault Ste. Marie across Lake Superior, seem to indicate that Essar might operate a taconite plant alone for a period of years. With a 15-year lifespan estimated on the plant, it would take steel demand of massive proportions to justify finishing the steel mill portion. Proposed, yes. Possible, yes. Probable, only maybe.

Essar is upping its taconite pellet production estimates from 4.1 million tons to 6.5 million tons. That’s great, but when it’s all being fed to Algoma I think the company is hedging its bets. It’s going to get its raw North American materials from the Iron Range, but where it produces its secondary steel products will depend entirely on the demand for steel. Indeed, it’d be foolish to believe otherwise for this or any other private company.

I still welcome Essar to northern Minnesota, but must also remind all of us who live in its economic sphere of influence of something important we should already know. One project, especially a big one, is more likely to under-perform its promise than not. One project, or even two or three, won’t even begin to replace the jobs we’ve lost — including the ones lost in the 1980s at the former Butler Taconite site near the current Essar location. One project won’t fix systemic, decades-long demographic change. We need to build a 21st century economy. Patching the 20th century economy will buy us years, not decades and certainly not generations. Start small. Consolidate efforts where possible. Focus on quality of life, schools and services. That’s what will bring jobs. It won’t be easy and we’ll need all hands.

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