The Iron Range Resources and Rehabilitation Board on Tuesday will consider replacing terms of an existing financial agreement with Minnesota Steel Industries, LLC.
The 13-member board is being asked to replace an agreement that calls for Iron Range Resources to receive future royalties from an iron ore deposit near Nashwauk if Minnesota Steel fails to develop the ore body, according to Matt Sjoberg, Iron Range Resources development strategies director.
Under a new agreement, Iron Range Resources would be guaranteed $6 million in a line of credit from the Bank of India, New York branch, should the project not be developed, said Sjoberg.
Essar Steel, an India-based steelmaker, plans in coming months to take control of the $1.6 billion project from Minnesota Steel.
The project would include a new open pit iron ore mine, processing plant, direct-reduced iron facility, and a steel mill capable of making 2.5 million metric tons of slab steel per year.
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John Elmore, president and chief executive officer, said the new agreement would benefit Iron Range Resources and the project.
If built, it would be the state's largest industrial project.
The steel mill would be the first of its kind in the nation.
The project is expected to employ about 700, create about 2,100 spin-off jobs, and have a $600 million annual economic impact. About 2,000 construction workers would be needed to build the facility near the site of the former Butler Taconite plant.
The IRRRB meets at 4 p.m. at Iron Range Resources south of Eveleth to consider replacing terms of the agreement.
