Essar Steel Holdings, a part of Essar Global, has lined up investments of more than $4 billion in North America. The investments would be made in the company’s acquisitions of Algoma in Canada and Minnesota Steel in the US, as well as greenfield plants in Trinidad & Tobago.
The groundbreaking ceremony for the first steelmaking facility in Minnesota’s Iron Range was held today. Speaking on the occasion, Shashi Ruia, Essar group chairman said, Essar remained committed to North America with investments of over $4 billion in the region and currently employs 8,000 people.
Minnesota was acquired in 2007 and has more than 1.4 billion tonnes of iron ore in the Mesabi range.Ruia said, “We are excited about starting this project. Today’s groundbreaking is another step towards our goal of building a large presence in the steel sector in the Americas.”
Besides iron mining and production, the $1.6 billion project would include a concentration plant, a pellet plant, a direct reduced iron (DRI) plant and steelmaking facilities.At full production, Essar Steel Minnesota would employ nearly 500 people and up to 2,000 construction workers over the course of the project.
Iron ore pellets would be produced within two years from the start of construction. Production of DRI pellets and steel slabs were expected to begin the fifth and sixth year onwards, respectively. The production from the facility would also support the Essar Steel Algoma in Sault Ste Marie, Ontario in Canada.
Essar has committed a capex of $500 million in Algoma in the next five years. Following the acquisition, Essar Steel Algoma increased its capacity from 2.4 million tonnes to four million tonnes in less than a year.
The company believes that the synergies between the Minnesota and Algoma facilities would strengthen Essar’s presence as an integrated steelmaker with high value-added products, in the North American market.
Essar Steel currently has a capacity of nine million tonnes across geographies but has set a target of 20-25 million tonnes capacity.
