Cleveland-Cliffs said it no longer needs to negotiate a land swap with a rival mining company to help keep Hibbing Taconite open beyond 2025, just one week after it told the Minnesota governor it was open again to such negotiations.
In a statement, the iron ore miner and steel producer said Cliffs CEO Lourenco Goncalves informed Gov. Tim Walz in a call Monday that the company "has identified a solution to extend HibTac’s life of mine using land already under the control of Cleveland-Cliffs. With this solution, no land swap with other companies will be necessary to extend the life of HibTac."
Just where is that land and what is the plan? The company refused to say.
The statement went further, suggesting the plan had Walz's blessing.
"Gov. Walz stated his commitment to direct his agencies to take all legally possible actions to support Cliffs’ initiative," the statement said.
But the governor's office took issue with Cliffs' characterization of the phone call and told the News Tribune no agreement had been made during the call.
"Governor Walz appreciated the opportunity to talk with Cleveland-Cliffs about keeping Hibbing Taconite open and protecting 800 jobs on the Iron Range," Teddy Tschann, a spokesperson for Walz, said in a statement. "The Governor also looks forward to talking with U.S. Steel and is committed to exploring all options to find a solution."
The phone between Goncavles and Walz was spurred by Walz sending letters sent to Goncalves and David Burritt, the president and CEO U.S. Steel, urging the companies to restart negotiations for a land swap between the companies that would help extend the life of Cliffs' Hibbing Taconite and U.S. Steel's Minntac.
Without additional ore, Hibbing Taconite will run out and close in 2025, taking almost 750 jobs at the iron ore mining and pellet plant in Hibbing with it.
U.S. Steel owns the Minntac and Keetac iron ore mines and pellet plants in Mountain Iron and Keewatin. U.S. Steel also owns a 14.7% stake in Hibbing Taconite. Cliffs manages Hibbing Taconite and owns the remaining 85.3% stake after buying ArcelorMittal's U.S. assets late last year.
The Minnesota Department of Natural Resources has been trying to get Cliffs and U.S. Steel to negotiate using ore from the privately held Carmi Campbell Reserve near Hibbing Taconite to feed the plant. Currently, that reserve is leased to U.S. Steel's Keetac facility.
There are also Cliffs-controlled state leases (which had been controlled by ArcelorMittal until Cliffs purchased its assets last year) adjacent to the west pit of U.S. Steel's Minntac mine, near Buhl and Kinney, that the DNR has said could be negotiated to extend the lives of both Hibbing Taconite and Minntac.
In his letter to Walz last week, Goncalves agreed to land-swap negotiations over the Carmi Campbell land.
Cliffs' statement on Monday, however, said a land swap would no longer be necessary.
Goncalves' letter last week did mention the company had been looking at other options "including acquisition of land adjacent to Hibbing Taconite" to extend the mine's life.
Cliffs also has mineral leases intertwined within land in control of competitor Mesabi Metallics near Nashwauk. The Minnesota Department of Natural Resources has said it's possible for Cliffs to mine that ore and bring it to Hibbing Taconite and be processed into pellets.
But Goncalves has repeatedly asked both Walz, and former Gov. Mark Dayton before him, to take Mesabi Metallics' adjacent leases and give them to Cliffs instead.
The state has refused to do that, in part because it says the permitting process would need to start from scratch. In December, the state gave Mesabi Metallics, which has missed numerous lease deadlines, until May 1 to satisfy a list of requirements that would guarantee the extension of its leases.
During that hearing, Goncalves went as far as to threaten closing Hibbing Taconite if he did not get Mesabi Metallics' leases.
"I will state very clear on the record: I do not bluff," Goncalves said in a December meeting with the Minnesota Executive Council, which includes Walz. "If these leases stay with Essar, Mesabi — whatever name — I will shut down Hibbing Taconite because I will not have iron ore to continue Hibbing Taconite beyond the rest of the life of mine of four years."