Minnesota Governor Seeks Support from U.S. Steel, Cleveland-Cliffs on Iron Range Jobs

“As you know, Hibbing Taconite has limited access to mineable ore reserves and is facing the possibility of closure in the coming years. While it is my understanding that Minntac has reliable reserves available for the immediate future, U.S. Steel has expressed interest in securing leases for additional high quality ore that would solidify the long-term operations for the mine. Closure of any mine would be devastating to the individuals who work at the facility and to those in the surrounding community who depend on the mines.

“I believe the continued success of both mines is possible. It is my understanding that there are mineable sources of additional ore in the immediate vicinity of both Minntac and Hibbing Taconite that are not currently owned or leased by the owner/operator of the mine to which the ore is most proximate. Minnesota needs leadership from our mining companies to work together on an approach that ensures the future success of both taconite operations. My agencies and I stand ready to provide assistance to U.S. Steel and Cleveland-Cliffs as they work towards a path forward.”

Hibbing Taconite is expected to run out of ore by 2024. In 2018, the mine was jointly owned by ArcelorMittal, Cleveland-Cliffs and U.S. Steel, holding shares of 62.3 percent, 23 percent and 14.7 percent, respectively. Cleveland-Cliffs relinquished its management role to ArcelorMittal in August 2019 in order to concentrate on its wholly owned businesses and its new HBI plant in Toledo, Ohio. With the acquisition of ArcelorMittal USA last year, Cleveland-Cliffs became majority owner of Hibbing and sole owner of Minorca Mine.

U.S. Steel owns and operates Minntac and Keetac in Minnesota’s Mesabi Iron Range. Keetac was idled in 2020, but restarted in December due to increasing steel demand.

On Tuesday, Goncalves responded by letter to the governor:

“As the majority owner and manager of the Hibbing Taconite joint venture, Cleveland-Cliffs continues to advance options for mining beyond the current reserve base of five years, including acquisition of lands adjacent to Hibbing Taconite.

“During the previous period through August 2019 when Cleveland-Cliffs was acting as the Manager of Hibbing Taconite, we engaged in numerous negotiations with U.S. Steel over the Carmi-Campbell leases. From August 2019 to December 2020, when ArcelorMittal acted as the Manager of the Hibbing Taconite joint venture, these discussions with U.S. Steel continued. Regardless of which party was acting as the Manager, a commercially viable solution has failed to materialize.

“The unsuccessful negotiations with U.S. Steel were a very important part of our decision to acquire land in Nashwauk, in order to provide us with the mine life extension we need at Hibbing Taconite. If Cleveland-Cliffs controls Nashwauk, not only Hibbing Taconite will be saved, but we would also have the opportunity to build a direct-reduction plant on the site, creating the basis of a future steel mill in Nashwauk, locally supplied with HBI.”

Goncalves asked the state to assist “in convening the parties to work quickly toward facilitating a viable option with the Carmi Campbell leases.”

U.S. Steel spokesperson Meghan Cox emailed the following statement in response to the governor and Cleveland-Cliffs:

“U.S. Steel recognizes the importance of Hibtac and all iron mining operations to the communities, employees and businesses on the Iron Range. We have and will continue to work collaboratively with the governor and the Iron Range legislative delegation to seek a workable solution that will benefit all concerned stakeholders.”