Essar Steel Minnesota reported in late October that construction of its 7-million-mt/y iron-ore mining, crushing, and pelletization project near the town of Nashwauk on the western end of the Mesabi Iron Range in northern Minnesota was 50% complete and remained on schedule to start pellet production in the second half of 2015. When completed, the $1.8 billion project will include an open-pit iron ore mine; crushing, concentrating and pelletizing facilities; and a rail line and train-loading system.
Essar Steel Minnesota is a subsidiary of Essar Steel, a multinational steelmaker headquartered in Mumbai, India. The Minnesota project has an aggregate of approximately 2 billion mt of measured, indicated, and inferred magnetite iron resources, of which approximately 1.7 billion mt are classified as proven and probable reserves.
Essar Steel Minnesota stated that it expects to be the lowest-cost producer of taconite pellets in North America and will be the only pellet producer in the United States to have the flexibility and production capability to produce standard blast furnace pellets as well as fluxed and DR grade pellets. Through firm long-term off-take agreements in place with ArcelorMittal USA and Essar Steel Algoma, Canada, Essar Steel Minnesota already has customers committed over the long-term to purchase its entire 7 million mt/y of planned production.
The Essar Steel Minnesota project has access to rail lines serviced by Burlington Northern Santa Fe Railway and Canadian National Railway. In addition, the project has the option to export to customers in the future via the Atlantic Ocean by transshipping through the St. Lawrence Seaway to the ocean-loading port of Quebec City.
The Essar Steel Minnesota project area totals approximately 19,000 acres, of which 4,360 acres are mineral lease land. Environmental permits are in place for construction and operation of the project.