New Cliffs CEO visits Iron Range, predicts stable times for taconite
VIRGINIA -- In his first 100 days on the job, Gary Halverson closed Canada's third largest iron ore mine, halted a chromite mining project in Ontario and worked to fend off a Wall Street demand that his company split up.
Other than that, it was mostly uneventful for the new president and chief executive officer of Cliffs Natural Resources.
Halverson spent Thursday on the Iron Range, where his company operates three of Minnesota's six major taconite iron ore operations, saying his company is "shrinking to grow'' but predicting a good year for its part of the state's taconite industry.
Halverson, speaking to Iron Range business and community leaders, said he expects U.S. automakers to build 16.5 million vehicles in 2014, 1 million more than 2013; that new construction should increase 6 to 8 percent this year; and that U.S. steel demand should increase 4 percent this year over last, creating a good market for his company's taconite iron ore.
"We're about back to full production at NorthShore (mining) and we expect to produce between 22 and 23 million tons of pellets this year'' at U.S. operations, Halverson said, noting that's up from 21 million tons in 2013.
The Ontario native and former gold mining executive said all three of Cliffs' Minnesota operations -- Hibbing Taconite, United Taconite and NorthShore Mining -- will be at virtually full capacity with stable employment in 2014. Moreover, the company's Upper Michigan operations, Empire and Tilden also will keep producing, with Halvorsen at the helm as Cliffs inked a deal last month with ArcelorMittal USA that will keep Empire open into 2017, two years after it was scheduled to be closed.
With the company scaling back on global growth plans and cutting new spending in half from 2013, Halvorsen intends to "focus on the core business of what we do; iron ore" as part of the company's "drive to a leaner, more efficient organization." But, Halverson said his company will continue to invest in its Iron Range operations, noting they are among the most cost competitive in the North America.
Cliffs said in February that it would close its Wabush iron ore mine in Newfoundland and Labrador and suspend efforts to build a second phase at its Bloom Lake iron ore mine in Quebec. Cliffs also owns an iron ore mine in Australia and coal mines in the U.S.
Halverson's company was praised by several Iron Range officials Thursday at the company's annual breakfast gathering for Cliff's stable operations and investment in Minnesota. The company has 1,856 employees on the Range with a payroll of $251 million.
Halverson, who now oversees 7,100 Cliffs employees worldwide, previously headed Toronto-based Barricks North American operations, which included 10 mines and 6,200 employees. He has also managed mines in Australia and Papua New Guinea.
On other issues Halverson:
"There are no customers yet in our field of view,'' Halvorsen said. "But it's coming."