Minnesota Power: Renewable energy use likely to cut need for coal
Peter Passi
Duluth News Tribune - 10/31/2007

Despite growing demand for electricity, Minnesota Power said it projects it will have no need for additional coal-fired generation for the next 15 years.

The Duluth-based company will submit its resource plan today to the Minnesota Public Utilities Commission. That plan forecasts that by 2022, its customer load will approach 1,950 megawatts. Minnesota Power’s customers consume almost 1,750 megawatts of power. One megawatt is typically enough energy to power 250 to 300 homes.

“Through this resource plan, we’re recommitting to our goal of reducing carbon emissions,” said Dave McMillan, a senior vice president for Minnesota Power.

While Minnesota Power plans to steer clear of new coal-fired plants, it does aim to increase its overall power-generating capacity. McMillan said the company expects to add 300 to 500 megawatts of renewable energy through investments in wind power, hydroelectric and biomass-fueled plants.

McMillan said Minnesota Power continues to explore the possibility of building a biomass unit at Laskin Energy Center in Hoyt Lakes. He said he expects to announce an East Range project some time in the next several years.

The company already buys 50 megawatts of electricity from the Oliver Wind Energy facility in North Dakota and it expects to have another 50 megawatts of North Dakota wind power online by year’s end. During 2008, Minnesota Power plans to install 10 large wind turbines on Minntac property in Mountain Iron, adding 25 megawatts of wind power.

By state law, Minnesota utility companies will need to generate 25 percent of their electricity through renewable sources by 2025.

As Minnesota Power leans more heavily on wind power, it will need more plants that kick in during breezeless spells and periods of high demand.

McMillan said these generators probably will be fueled by natural gas. He said they will operate only as needed. Typically, natural gas-powered generators produce about 40 percent less carbon dioxide per megawatt than coal-fired plants.

The plants also will help Minnesota Power meet the challenge of growing air conditioner use in the Northland. McMillan said Minnesota Power has seen a surge in warm-weather electrical demand in recent years, largely because of growing development in the Brainerd area.

Several large industrial projects on the Iron Range also will boost Minnesota Power’s need for baseload electrical generation. Minnesota Power is preparing to supply electricity to new mining and processing plants now in the works, including PolyMet, which will need 75 megawatts of electricity, and Mesabi Nugget, which will need at least 15 megawatts, McMillan said.

Minnesota Power has a couple of merchant power contracts expiring in the next few years. This electricity, which had been sold under contract to other utilities in the past, will now be used to supply Minnesota Power’s customers, McMillan said. By 2010, the company should have about an additional 250 megawatts at its disposal as a result.

Pawlenty asks State Department for clarification on company's Iran ties
Duluth News Tribune - 10/29/2007

Gov. Tim Pawlenty said today he remains “hopeful” that he will be able to support plans to build a $1.2 billion steel slab plant near Nashwauk. But first, he said he needs assurances from its primary investor, Essar Global Ltd., that the company will abide by sanctions aimed at punishing Iran for its terrorist activities.

Pawlenty believes the Indian company’s involvement in a proposed Iranian refinery project could constitute financial support for what the U.S. government has labeled a terrorist state. He’s also concerned about Essar’s other business dealings in Iran, including a potential investment in a joint-venture steel mill, the pending acquisition of exploration rights in the Azadegan oil fields and the purchase of oil and liquefied natural gas from the company.

On Monday, Pawlenty sent a letter to Secretary of State Condoleezza Rice and David Mulford, the U.S. ambassador to India, asking for their help in determining whether Essar’s activities in Iran run afoul of U.S. law.

“I seek the assistance of your department in determining if Essar’s activities in Iran are a potential violation of the Iran Country Sanctions Act or are otherwise a cause for concern. If they are not, I will gladly support their efforts in Minnesota,” the governor wrote.

If the company gets a clean bill of health from federal authorities and pledges to honor trade sanctions imposed against Iran, Pawlenty said he will back Itasca County’s request for about $62 million in state funding to install some of the infra-structure needed to support a steel plant.

“The Minnesota Steel project is one that I have supported, and I want it to go forward,” Pawlenty said. “No one was more heartbroken than me when I learned of this potential problem related to Essar’s involvement in Iran. I still hope this issue can be cleared up and the project will be able to move forward.”

The governor is particularly perturbed by a Reuters news service report that Essar plans to help begin building an $8 bil-lion to $10 billion oil refinery in southern Iran next year. Iran currently has no large-scale oil refining capabilities, and the Reuters report indicated Essar planned to partner with its government to build a facility.

Longtime mayor of Kinney dies
Lee Bloomquist
Duluth News Tribune - 10/25/2007

An Iron Range matriarch is gone.

Mary Anderson, the feisty former longtime mayor of the “Republic of Kinney,” died Wednesday afternoon at Heritage Manor Health Care Center in Chisholm.
She was 92.

“This is like losing an institution,” U.S. Rep. Jim Oberstar said. “If Ironworld or Giants Ridge were shut down, or the name ‘Mesabi’ was erased from the Iron Range, it would be Mary that personified those characteristics.”

Anderson’s small bar in Kinney was a political gathering place for many well-known DFL politicians.

Politicians such as Rudy Perpich, Paul Wellstone, Hubert Humphrey, Michael Dukakis and Orville Freeman either launched their careers with fundraisers at the bar or made it a regular stop when on the Iron Range.

“She was a great lady and one who epitomizes that first generation of Americans who grew up in mining towns,” said state Rep. Tom Rukavina, DFL-Virginia. “She was a fighter, not afraid to speak her mind, and an intelligent woman who came up with the idea of seceding from the union to get what her town needed.”

Today the mine is buzzing with activity - but not long ago, it seemed doomed. In early 2003 it went bankrupt and 450 men were laid off. The Iron Range had been haemorrhaging jobs ever since the 1980s, when demand for iron ore began to shrink - along with the US steel industry.

"There were no prospects at that time for reopening the mine - it looked fairly bleak," recalls Joe Strlekar, president of the local branch of the United Steelworkers union at the time. "A larger mine than ours had closed two years earlier and put 1,400 people out of work, so there was a lot of bitterness."

But then, almost out of the blue, China came to the rescue. Not long after the mine closure, the receivers got a phone call from agents in Hong Kong representing a Chinese company called Laiwu Steel which was looking for new investments.

They had never heard of Laiwu before, but they contacted their congressman in Washington DC, Jim Oberstar - who was then straight on the phone to his friend, the Chinese ambassador. Within months, Oberstar had hammered out a three-way deal to get the iron ore to China.

The congressman, who himself comes from a family of miners, was all too aware of the vulnerability of the Iron Range. He had already seen undercutting from Brazil - what he didn't anticipate was today's demand from China.

"This story is a classic one of international trade shutting down an industry and international trade starting it up again," he says.

Indian firm buys Minnesota Steel; will build steel plant
Lee Bloomquist
Duluth News Tribune - 10/23/2007

NASHWAUK — A financial manager in Grand Rapids offered what’s become an often-heard comment about a $1.6 billion steel mill proposed on Minnesota’s Iron Range.

“He was sitting next to me and he said: ‘I didn’t realize that this was going to be such a big project,’ ” said Peter McDermott, president of the Itasca Economic Development Corp. “It’s like a lot of other people. They don’t believe
it until they see it.”

On Monday, the largest industrial project in the history of the Iron Range gave residents one more reason to believe, taking one of its final steps toward completion. Essar Global Limited, a steelmaker based in India, bought Minnesota Steel Industries and its steelmaking facility proposed near Nashwauk.

The project holds potential to transform the region by adding good-paying jobs, creating spinoff businesses, attracting new families to the region and boosting school enrollments.

“I think this is pretty exciting, myself,” said Peter Kakela, a Michigan State University professor who studies the iron ore industry. “We’ve been importing about 10 million tons of steel slabs per year over the last 10 years. It would be great to have a domestic source.”

“I don’t know if people understand what the magnitude of this is,” Marvin Vuicich, president of American Bank in Hibbing, said of the project. “It’s going to have an absolutely huge impact. It’s going to create a huge housing need in several Iron Range cities, increase property values, rental rates and create a huge need for workers. Maybe it’s going to be a way to keep more young people on the Range.”

Minnesota Steel officials would not comment on the sale price. However, the transaction means construction of the mammoth project probably will begin early in 2008.

“Essar Steel is a global conglomerate and is now going to take the project to successful fruition,” said Steve Hicks, Minnesota Steel vice chairman. “Yes, they will be able to construct the project.”

Full financial closure for the steel plant, in which Essar would secure $1.6 billion for construction, is expected by January.