All this progress leaves the higher-ups at Mesabi Metallics feeling that the wind is at their backs.
“At this location, we have the opportunity to truly do something unique: to vertically integrate modern steelmaking processes, which will allow us to be the cleanest steel producer in the world [and] one of the lowest-cost producers of steel in the world,” Broking said.
Such a play would align Mesabi Metallics with U.S. Steel, Cleveland-Cliffs, and other global steelmakers like ArcelorMittal. These companies operate sprawling mills that refine iron and a host of finished steel products all in one place.
Historically, steelmakers have sited those mills closer to where they or their suppliers dug coal out of the ground. But as blast furnaces go the way of the steam locomotive, 5 Lakes Energy’s Boatman said it makes more sense to produce purified iron — and maybe even finished steel — closer to the iron mines. The calculus is especially important for the Iron Range operations planning to mine waste piles or tailings, which tend to have lower iron content and require additional work to concentrate, she added.
“One of the push points to moving [purified] iron production here is that around one-third of the pellet is not iron,” Boatman said. “Why would you want to pay for fuel and time to ship non-iron when you could just ship the iron itself?”
It would be a return to form for northeastern Minnesota. U.S. Steel ran a blast furnace at its 1,500-acre Duluth Works from the late 1910s to the early 1970s and continued finished steelmaking there until the late 1980s. Employment peaked around 3,500 and annual output north of 900,000 tons, according to a Mesabi Tribune retrospective published in 2020.
Virtually nothing remains today. The site, a 1,500-acre brownfield just inland from a deepwater port that handles millions of tons of Iron Range pellets every year, would be a natural choice for a DRI-based steelmaking facility. In theory, it could host renewable energy facilities to enable large-scale hydrogen production, which would require hundreds of megawatts of clean power to supply a fully decarbonized shaft furnace.
Boatman said the idea of a DRI plant in Duluth has been studied, but any firm plans remain years off. As for what Rep. Igo enthusiastically calls the “dream” of integrated, DRI-based steelmaking on the Iron Range itself, the $800 million investment U.S. Steel recently said it would make in its existing Minnesota operations is too little to cover the multibillion-dollar cost of an integrated steel plant. And Mesabi Metallics would need to complete additional permitting to get permission to move forward at its own site, Boatman said. Meanwhile, local media outlet Iron Range Today reported on Feb. 24 that Mesabi Metallics is eyeing a potential DRI facility in Kentucky, citing job postings, public filings, and legislative lobbying activity. As of mid-July, the job-posting website ZipRecruiter showed about 20 active listings from Mesabi Metallics there, some mentioning “our DRI and Integrated Steel Plant.”
Broking reiterated Mesabi Metallics’ position that it would begin using hydrogen in its pelletization plant first — as soon as economically feasible. It won’t happen tomorrow, though.
“We should be studying these things,” he said. “But in terms of when that could happen or how it could happen … [We’ll] wait and see.”
State economic development officials and the steel industry itself had high hopes for green hydrogen, the kind produced with 100% renewable power, said Pete Wyckoff, who was deputy commissioner of energy resources for the Minnesota Department of Commerce when I interviewed him earlier this year. In May, he joined the clean energy nonprofit Evergreen Action as vice president of policy.
Since then, persistently high costs for hydrogen electrolyzers, rising power prices, the Trump administration’s suspension or cancellation of billions in hydrogen hub funding, and Washington Republicans’ partial repeal of federal tax credits for the fuel have worsened already-challenging green hydrogen economics. It doesn’t help when deep-pocketed data center companies compete for the same grid interconnections as price-sensitive hydrogen developers, Wyckoff said.
“Everyone is looking at it now with slightly cut-back expectations. … I’m skeptical about the turn to hydrogen happening right away,” Wyckoff said.
Unless. Wyckoff and several others interviewed for this story expressed varying degrees of optimism about the possibility of geologic hydrogen extraction in northern Minnesota. If present and recoverable in sufficient quantities at or near DRI plants, naturally occurring or stimulated hydrogen reserves would solve the vexing problems of transportation and storage. The economics of hydrogen production would almost certainly improve, and with them the economics of ultralow-carbon steel.
At least three companies have asked the state for exploratory drilling permits, including the buzzy Colorado startup Koloma.
“It might not look exactly as we imagine it, but there’s a ‘there’ there,” Wyckoff said.
Igo agrees. He’s the lead author on a bill that would give NRRI $650,000 to investigate Minnesota’s geologic hydrogen potential over the next two years. Minnesota lawmakers are separately working on gas drilling regulations that would govern hydrogen and helium extraction — a novel concept in a state with no significant oil or natural gas reserves.
“If we find this stuff near a taconite mine — wow,” Igo said, “Minnesota will be the epicenter of the iron industry.”
