DNR to block Essar Steel from doing business with state

A massive crane moves steel beams at Essar’s Nashwauk plant on May 21, 2015. (Aaron J. Brown)

Earlier this month, Essar Steel roared back to life in the continuing saga of a proposed iron mine near Nashwauk, Minnesota. Today, the Minnesota Department of Natural Resources said that the state wasn’t buying it.

Specifically, new DNR commissioner Sarah Strommen wrote Mesabi Metallics, the current iteration of the developer, that she seeks to debar Essar Steel from doing any business with the State of Minnesota.

Essar had announced it would lead a group of investors in finishing the project this year.

Writes Strommen:

The DNR has no confidence that Essar, if it were to take any operational, management, oversight, or even investor role in the Mesabi Metallics project, would act in good faith to ensure timely construction and professional operation of the project.

As it stands, Mesabi Metallics still holds first dibs on the state mineral leases for mine lands near the former Butler Taconite plant. However, Cleveland-Cliffs still owns critical lands adjacent to and throughout the mine plan. Cliffs snatched up this land from frustrated fee-holders tired of waiting for Mesabi Metallics and Essar Steel before that.

The state allocated $64 million in bonding money to Itasca County for infrastructure for the project. Essar built about half of the $1.2 billion project in 2015 before running out of money and declaring bankruptcy in 2016. The bones of the unfinished plant have bleached in the sun ever since.

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