“Today’s announcement marks a very important strategic milestone for Cliffs as we begin to implement our plans to be the sole producer of high-quality HBI for the (electric-arc furnace) steel market in the Great Lakes region,” Cliffs CEO Lourenco Goncalves said in a news release.
Cliffs had sought the half-built Essar operation in Nashwauk to feed an HBI or direct-reduced iron plant, but Chippewa Capital Partners this week had the winning bid in bankruptcy court and was granted access to state mineral leases.
Chippewa intends to build its own HBI plant in Nashwauk to open the ore mined there — and on the Iron Range overall — to the fast-growing electric arc mini-mill market, considered the future of U.S. steelmaking.
Cliffs’ $700 million investment is headed to a brownfield at the Port of Toledo. The new plant will likely use taconite pellets made in Minnesota.
Goncalves made the stakes clear this spring when talking about the former Essar site.
“If I continue to be denied access … I’m going to find somewhere else to do it,” Goncalves said at a company event in Chisholm in April.
Ohio and other agencies offered $30 million in “grants and other financial incentives” to land the plant, Cliffs said in Thursday’s news release.
The plant will be able to produce up to 1.6 million tons of HBI per year after it comes online in 2020.
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