IN: Magnetation, AK Steel to Invest $350M, Hire 100 for Iron Ore Pellet Plant
29 Nov, 2012
Magnetation, LLC, which recycles iron waste to produce valuable iron ore concentrate, announced plans to invest up to $350 million to build a new iron ore pellet plant in Reynolds, creating approximately 100 new jobs by 2015. The new facility will produce high-quality iron ore pellets, a critical raw material in the steelmaking process. The company anticipates breaking ground on the plant during the first quarter of next year.
"Magnetation joins a growing list of companies that have discovered what we Hoosiers have always known: Indiana is the best state to do business in the country," said Governor Mitch Daniels. "We are happy to welcome our new neighbors to Reynolds and thank them for the multi-million dollar investment and the many jobs that come with their decision."
Magnetation will transport iron ore concentrate from its mineral recovery operations in northern Minnesota to its new Reynolds plant, which is expected to be operational by early 2015. The concentrate will be converted into high-quality iron ore pellets for use by AK Steel Corporation.
"With convenient access to major railways and highways, Reynolds is an outstanding location for the company's new pellet plant," said Larry Lehtinen, chief executive officer of Magnetation. "We thank our local and state officials in Indiana for their ongoing support of our company, and we look forward to joining the Reynolds community in the very near future."
The Indiana Economic Development Corporation offered MagPellet, LLC, a part of Magnetation, up to $1.5 million in conditional tax credits and up to $200,000 in training grants based on the company's job creation plans. These tax credits are performance-based, meaning until Hoosiers are hired, the company is not eligible to claim incentives. The Indiana Department of Transportation will also assist the community with improving rail service to the site. White County offered funds using revenues generated from the issuance of a tax increment financing (TIF) bond. NIPSCO has also offered the company $23 million in additional energy and infrastructure incentives as part of its continued efforts to support local economic development.
"This announcement is a huge shot in the arm for the local economy in Reynolds and White County," said John Heimlich, president of the White County commissioners. "We are pleased that Magnetation has chosen to locate in the former VeraSun facility and look forward to a long and prosperous relationship with the company."
Magnetation LLC is a joint venture between Magnetation, Inc. (50.1% owner) and AK Steel Corporation (49.9% owner). Magnetation LLC reclaims high-quality iron ore concentrate from previously abandoned iron ore waste stockpiles and tailings basins. Currently, Magnetation LLC owns and operates two reclamation plants located in Keewatin, MN and Taconite, MN. Magnetation LLC expects to construct a three million metric tonne per year iron ore pellet plant in Reynolds, Indiana and two additional concentrate reclamation plants located northwest of Coleraine, MN and southeast of Calumet, MN. Additional information about the company is available at www.magnetation.com.
AK Steel produces flat-rolled carbon, stainless and electrical steels, primarily for automotive, infrastructure and manufacturing, construction and electrical power generation and distribution markets. The company employs about 6,200 men and women in Middletown, Mansfield, Coshocton and Zanesville, Ohio; Butler, Pennsylvania; Ashland, Kentucky; Rockport, Indiana; and its corporate headquarters in West Chester, Ohio. AK Steel also owns 49.9% of Magnetation LLC, a joint venture headquartered in Grand Rapids, Minnesota, which produces iron ore concentrate from previously mined ore reserves. Additional information about AK Steel is available on the company's web site at www.aksteel.com.
Created by Governor Mitch Daniels in 2005 to replace the former Department of Commerce, the Indiana Economic Development Corporation is governed by a 12-member board chaired by Governor Daniels. Dan Hasler serves as the chief executive officer of the IEDC.
The IEDC oversees programs enacted by the General Assembly including tax credits, workforce training grants and public infrastructure assistance. All tax credits are performance-based. Therefore, companies must first invest in Indiana through job creation or capital investment before incentives are paid. A company who does not meet its full projections only receives a percentage of the incentives proportional to its actual investment. For more information about IEDC, visit www.iedc.in.gov.