Mesabi Metallics has competition in its effort to take over the former Essar Steel Minnesota taconite project in Nashwauk, with both Cliffs Natural Resources and the new owner of Magnetation submitting proposals for the bankrupt operation.

Mesabi Metallics, a branch of California-based SPL Investments, has been working as the successor to Essar Steel Minnesota to recover the project that has sat idle since late 2015. But bankruptcy rules allow a competitive bid process as the bankruptcy nears its final stages, working to get creditors as much of their money back as possible.

On Saturday, an investor group calling itself Chippewa Capital Partners LLC - and which includes Tom Clarke of Roanoke, Va., owner of ERP Iron Ore - submitted a bid of $250 million to a federal bankruptcy court in Delaware for the project that sits about half finished.

Clarke was the successful bidder late last year for the bankrupt Magnetation ore recovery and processing operations and expects ERP Iron Ore to begin production at one of the former Magnetation sites within the next few weeks.

Both the Mesabi Metallics and Chippewa offers would work through the current Chapter 11 reorganization efforts.

Also Monday, Mesabi Metallics officials said Cleveland-based Cliffs Natural Resources made a non-binding proposal to Mesabi Metallics to purchase most of the former Essar assets for $75 million as part of what Mesabi Metallics called a “liquidation” offer. Cliffs’ bid has not yet been filed with the court.

Competing bids were due by an April 13 court hearing.

India-based Essar Steel pumped $1.8 billion into the Nashwauk project over several years before walking away in 2015, still owing more than $1 billion of that to investors. Mesabi Metallics has said it will cost another $800 million to finish the project and start mining and processing taconite iron ore, Minnesota first new taconite operation in 40 years.

Mesabi Metallics officials said the competition will help lead to the best possible offer to the creditors who are owed millions of dollars, including global banks and investment firms as well as Minnesota vendors and contractors who helped build the project but weren't fully paid.

If two or more more legitimate bids are received by the court deadline, an auction could be held by a bankruptcy judge at a hearing later this month that will likely decide the fate of the Nashwauk project.

“We are pleased to have several potential sponsors compete for the opportunity’’ to acquire the project, said David Pauker, chief restructuring officer of Mesabi Metallics, in a statement.

But Pauker said the Cliffs proposal falls well short of the mark.

“The proposal from Cliffs appears to be a continuation of Cliffs’ long-running effort to take control of the project without paying fair compensation to creditors or lenders,” Pauker said. “Our preliminary view of the Cliffs proposal is that it is the financial equivalent of a liquidation and is therefore far less favorable to our creditors.”

Cliffs CEO Lourenco Goncalves said his company’s $75 million offer “represents a realistic value for the assets,” in a statement issued Monday.

“Such concrete indication of interest stands in contrast with the plans put forth by both Mesabi Metallics and Chippewa, which are loaded with assumptions, conditions, contingencies, smoke and mirrors. The Iron Range people have heard this story before,” Goncalves said.

Essar's Nashwauk facility was supposed to employ 350 people by 2014, producing some 7 million tons of taconite iron ore pellets each year. Plans originally called for an iron and steel plant on the site, creating even more jobs, although Essar scrapped those plans years ago.

Ground was broken in 2008 but work occurred in fits and starts until Essar ran out of money and walked away late in 2015.

Mesabi Metallics has filed suit against the India-based parent company of Essar Steel Minnesota alleging money for the Minnesota project was fraudulently funneled elsewhere. Essar officials vehemently deny those claims.

Matthew Stock, the new Mesabi Metallics CEO, has said the new company still can deliver on many of the failed promises of Essar. He also envisions a day when the Nashwauk project expands to include a direct-reduced iron plant - not just a DR-ready pellet - the kind of added-value products Iron Range promoters have been waiting decades for.

Both Goncalves and Clarke also have talked about direct-reduced iron as being a goal of whoever gains control of the Nashwauk site.