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SILVER BAY, MN-The Mesabi Nugget Corp., founded by an iron consulting company earlier this year, has plans to build a $60-million commercial plant on Minnesota’s Iron Range by December 2004. The venture aims at producing nearly pure iron nuggets from taconite, which could then be sold to mini steel mils that use scrap iron.

Larry Lehtinen, head of Mesabi Nugget, says he thinks it could lead to “a renaissance of the Iron Range.”

Mesabi Nugget has received financing or commitments from a variety of entities, including the Iron Range Resources and Rehabilitation Board, which recently approved a $500,000 loan; Cleveland-Cliffs Inc., which has tentatively agreed to house the project at its Northshore Mining Co. taconite plant in Silver Bay; and Kobe Steel Ltd. of Japan, a technology partner in the project. A major investor in the project is the state’s 21st Century Minerals Fund, an $80-million fund designed to encourage development of a value-added taconite product in Minnesota, which is expected to invest $50 million.

Steel Dynamics based in Butler, IN, has expressed interested as a potential customer and investors in the project, and the Minnesota Department of Trade and Economic Development is also considering lending or investing in the project.

The $84-million project has four steps: a $20 million technology development plan; $4 million for design and environment permitting; and $60 million for the plant.

The nuggets can be used in conventional foundries, but the target market would be mini-mills that use scrap steel. The plant would produce 300,000 tons of iron nuggets a year to start.

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