Minnesota Duluth Complex and Iron Range

http://www.hibbingmn.com/

Once, a few years ago, I was overcome with the urge to climb a roadside berm at an Iron Range taconite mine. I drove by this spot all the time, but couldn’t picture what was on the other side.

So I did it. (Don’t try this at home kids). I scrambled up the side to peer over the rampart. I’d seen mine pits before, but this was a tailings pond. Picture a vast lake surrounded by martian landscape spanning the entirety of your peripheral vision. The groaning engines in the pit miles away were the only sound.

I was overcome by the loneliness of it all. I came prepared to evade security. But there were no humans here. Not one.Despite recent struggles, iron mining remains the most productive industry here along Northern Minnesota’s Mesabi Range.

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http://www.duluthnewstribune.com/

A federal bankruptcy hearing Thursday in Delaware could decide the fate of valuable mineral rights to the iron ore under the shuttered Essar Steel Minnesota project in Nashwauk.

Attorneys for the state of Minnesota will argue that the mineral rights were withdrawn from Essar in July after the company failed to finish the project and reneged on paying $66 million owed the state for unfulfilled economic development guarantees.

The state also wanted Essar to repay local contractors and vendors who worked on the half-built project but who have not been paid. But Essar filed for Chapter 11 bankruptcy protection minutes before the state officially pulled the mineral leases, and now Essar is arguing that the mineral leases should be listed as assets that will be decided by the bankruptcy court — likely not until 2017 at the earliest.

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http://www.forbes.com/

Essar Steel Minnesota went into Chapter 11 bankruptcy on Friday as the State of Minnesota withdrew the state licences for the taconite the company was preparing to mine. It might seem a little odd that an Indian owned mine in Minnesota will go out of business as a result of the Chinese steel industry slowing down but that is what has happened.

This globalisation thing really does mean that the international markets are connected in this manner. The basic background here is that taconite is a low grade form of iron ore used to make steel. As China’s steel industry has grown less fast than other iron ore miners thought it would the price of high grade ore has fallen. That in turn has knock on effects on the low grade ore. There is a way out of this but not for the current owners, Essar.

The story:

“Essar Steel Minnesota, a sister company to Essar Steel Algoma and an expected future supplier of taconite to the Sault steelmaker, has filed for U.S. Chapter 11 bankruptcy protection, Minnesota news media are reporting.

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http://www.duluthnewstribune.com/

Top officials from Chilean mining company Antofagasta are in Washington this week meeting with key Minnesota lawmakers and their staffs about the company’s proposed Twin Metals copper mine near Ely.

Antofagasta is sole owner of the fledgling Twin Metals Minnesota company that wants to build a copper mine along the Kawishiwi River and on the edge of the Boundary Waters Canoe Area Wilderness.

Federal regulatory agencies are critical to the project because they hold key access to mineral and exploration rights where Twin Metals wants to mine. The Bureau of Land Management of the Interior Department currently is deciding whether to renew some of those leases.

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http://www.startribune.com/

AURORA, MINN. – When the mines go down on the Iron Range, everything else seems to follow. “Everything’s just closing down,” said Debra Schermann, standing on Main Street Aurora on a chilly spring Tuesday, staring across at the shuttered storefront where she once ran a pet grooming business.

The only grocery store in this east Range town of 1,600 went out of business in January. Aurora’s only drugstore shut its doors last summer, a few months after the nearby Mesabi Nugget iron plant idled, throwing 200 people out of work for at least two years.

It has been more than a year since the first layoff notices went out across the Range. The loss of those jobs, and the thousands that followed, cut across the region like a riptide. Two thousand layoffs in the mines triggered 1,350 layoffs among the contractors and mining support industries downstream.

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http://www.startribune.com/

Maybe we’ve been wrong all along about the abundant deposits of iron ore in northeastern Minnesota, enabling generations of Minnesotans to earn a good living by mining.

Maybe we’ve been wrong all along about the abundant deposits of iron ore in northeastern Minnesota, enabling generations of Minnesotans to earn a good living by mining. That great natural resource might not be a blessing after all. More like a curse.

It’s not a stretch to call it that, because all of that iron ore wealth just didn’t turn out to be the building block of a thriving and sustainable regional economy.

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http://www.startribune.com/

Word that 15,000 British mill workers are about to lose their jobs dominated steel industry news last week, as the mills’ owner wants out at any price. Of course by now a “15,000 Layoffs?” newspaper headline should be no surprise to the iron miners of northeastern Minnesota.

The iron and steel industry is in an epic slump, and it’s slumping everywhere. Minnesotans can’t remember a downturn without a broader economic recession here, and the blame for this one usually gets placed on cheap foreign steel.

Actually, cheap steel from abroad is a symptom. What caused this one was way too much cheap capital. It got poured into far too many commodity processing projects all over the world.

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