The Minnesota Pollution Control Agency on Thursday released a draft water-quality permit for Prairie River Minerals' "demonstration project" near Coleraine, where the company intends to process hematite left over by old mining companies into iron lump and sinter feedstock for the steel industry.

Once the permit is approved, it would allow the company, which bought several former Magnetation and ERP Iron Ore properties last year for $1.95 million in federal bankruptcy court, to process 500,000 metric tons of waste rock into 150,000 metric tons of lump and sinter ores over an expected 3-9 months. The company then intends on sending the lump and sinter to steel mills for evaluation.

If the steel companies like what they see, the plant could expand into a full operation, CEO Larry Sutherland told the News Tribune in April.

Water for the demonstration project will be taken from the West Hill mine pit and no water will be discharged back into the environment, the MPCA said.

"All process water used in the plant will be collected and recirculated, the only water to leave the plant will be moisture contained in the final products and rejects/waste material, and evaporation losses from the process," the draft permit said. "No process wastewater will be discharged to surface waters as a part of the demonstration project."

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If the company seeks to extend the demonstration project, process more than a 500,000 metric ton limit or go full-scale, it would need to apply for a major permit modification, the MPCA said. Groundwater monitoring is not necessary for the demonstration but would be required for any larger plant, the MPCA said.

Prairie River Minerals' Draft Permit

The MPCA also noted the demonstration project will require an air permit, a draft of which is expected later this fall.

Unlike the other mines and processing facilities on the Iron Range, Prairie River Minerals would not be producing iron ore pellets from mined taconite. Instead, it would be processing waste left over by past mines into lump and sinter ores.

Like pellets, lump ores — rough chunks of iron ore — can be added directly into a blast furnace, while sinter fines — iron ground down into a powder — must first be sintered in combination with other materials at high temperatures before it can be added to a blast furnace and turned into steel.

Prairie River Minerals intends on using a liquid to separate different materials within the rock by density, a process called “Ultra-High Dense Medium Separation.”

Prairie River Minerals did not immediately respond to the News Tribune's request for comment Thursday.

The MPCA is taking public comments on the permit through Oct. 23. Written comments can be sent to Stephanie Handeland, Minnesota Pollution Control Agency, Industrial Division, 520 Lafayette Road, St. Paul, MN 55155 or stephanie.handeland@state.mn.us.

Additional information is on the MPCA's website at pca.state.mn.us/regulations/prairie-river-minerals.