PolyMet purchases LTV facilities as mine plan begins to take shape

The state's first base and precious metals mine is a big step closer to reality.

PolyMet Mining Corp. on Tuesday finalized a deal with Cleveland-Cliffs Inc. under which PolyMet will take over ownership of portions of the former LTV Steel Mining Co. processing facilities near Hoyt Lakes.

The agreement means PolyMet now owns crushing, milling and flotation assets as well as buildings, real estate, spare parts, workshops and a 3,000-acre tailings basin at the site.

"Acquisition of this large complex provides PolyMet with about 80-85 percent of the physical plant assets needed to develop the NorthMet project," William Murray, PolyMet president and chief executive officer, said in a news release.

Using the former LTV facilities as opposed to new construction would savePolyMet about $200 million, Murray said.

It's been estimated that developing a base and precious metals mine about 12 miles south of Babbitt, along with additional processing facilities at the former taconite plant, would cost $225 million to $250 million.

Cleveland-Cliffs, which owned the property that PolyMet will use, will receive about 6.2 million shares of PolyMet.

PolyMet is still working on permitting the project, but company leaders hope to have commercial operations running in the first half of 2008.

A well-defined deposit east of the former taconite plant contains nickel, cobalt, silver, gold, palladium and platinum. The deposit contains an estimated 800 million tons of ore.

Constructing the plant and mine would employ 1,000 workers. About 400 permanent workers would be needed to operate the mine and plant.

Exploration for metals in Northeastern Minnesota has been ongoing for decades. However, until recently, developers haven't come up with cost-effective methods of extracting the low amounts of metals from the ore.

PolyMet leaders say the company has developed and tested a patented environmentally friendly hydrometallurgical process. To date, the company hasn't asked for any public assistance in financing the project.

PolyMet is a publicly traded Canadian mine development company.

Refurbishing the LTV processing facilities and opening a new mine would be a significant boost to the economy and help stabilize declining enrollment in some Iron Range schools.

LTV Steel Mining Co. closed in 2001 after its parent company, LTV Steel Corp., filed Chapter 11 bankruptcy. The shutdown put 1,400 people out of work.

PolyMet is a publicly traded Canadian mine development company.

Refurbishing the LTV processing facilities and opening a new mine would be a significant boost to the economy and help stabilize declining enrollment in some Iron Range schools.

LTV Steel Mining Co. closed in 2001 after its parent company, LTV Steel Corp., filed Chapter 11 bankruptcy. The shutdown put 1,400 people out of work.