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Mining in Minnesota. Land Ownership in Minnesota. Land Area 51.2 million acres Water Area 2.6 million acres. How should (do) we produce “recreation”. How should (do) we produce timber. U S Forest Service Minnesota DNR Division of Forestry St. Louis County Land Department
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Land Ownership in Minnesota • Land Area 51.2 million acres • Water Area 2.6 million acres
How should (do) we produce timber U S Forest Service Minnesota DNR Division of Forestry St. Louis County Land Department Timber Investment Management Organizations
How should (do) we produce wetlands? • Wetlands (EPA) • National Wetlands Inventory (US Fish and Wildlife Service) • Wetlands Regulation Center (Environmental Technical Services Co.) • Wetlands (Minnesota DNR) • Wetlands (Minnesota Statutes) • Wetland Conservation (Board of Water and Soil Resources)
Taconite Operations Mines Plants Port facilities Industrial Minerals Crushed stone Limestone Peat Silica sand Kaolin clay Granite
Geology of Minnesota http://www.dot.state.mn.us/materials/geologydocs/bedrckweb.pdf
Policy for Mineral Development • Minnesota Statutes c.93 • 93.001 It is the policy of the state to provide for the diversification of the state’s mineral economy through long-term support of mineral exploration, evaluation, environmental research, development, production and commercialization • 93.003 Legal authority to mine and process iron ore, a basic irreplaceable natural resource of the people of the state of Minnesota, is subject to the conditions of this section. When the owner or operator of an iron mine or related production or beneficiation facilities determines to discontinue the operation of the mine or facilities for any reason it shall maintain the mine or facilities in salable operating condition for at least two years after it discontinues operation in order to allow the state of Minnesota and other interested public and private bodies to seek a new owner and operator
93.01 The state hereby reserves for its own use all the iron, coal, copper, gold, and other valuable minerals, and all water powers in or upon all lands which now or hereafter may belong to it by virtue of any act of Congress
Construction and Building MaterialsVolume 23, Issue 9, September 2009, Pages 3070
Mining • The Mesabi Iron Range (Answers.com) • Statistics of US businesses. 2006. Mining Minnesota (US Census Bureau) • The Mineral Industry of Minnesota (US Geological Survey) • Iron Ore Statistics and Information (USGS) • Taconite Mining and Processing Industry Profile (EPA, 2001) • Iron Mining Association of Minnesota • Mining in Minnesota (National Mining Association) • Minnesota iron mining-our communities, state and nation depend on it (Iron Mining Association)
Mining in Minnesota’s Iron Range (Friends of the Boundary Waters Canoe Area) • Governor’s Committee on Minnesota’s Mining Future Final Report 2004 • Governor’s Committee on Minnesota’s Mining Future (Update Oct. 2008) • Steel Plan could hurt Iron Range (Fedgazette May 2002) • Iron Range – Mining frontier (Macalester College)
Minnesota Department of Natural Resources, Division of Lands and Minerals • Mining in Minnesota (Minnesota DNR) • Geology Education (DNR)
Minnesota Iron Mining • Tied to steel tracks (Federal Reserve Bank of Minneapolis) • Minnesota pilot plant (Online Insider) • Iron mining 2002 (MPR) • Surprise revival for iron mines of Minnesota (Christian Science Monitor April 22,2004) • Minnesota iron goes global (MPR May 19, 2005) • In Minnesota, mining makes and comeback (CNN.com Nov 21, 2007) • Session Daily - Mining proposals come under scrutiny (Jan. 25 2008) • New mining era for northeastern Minnesota -- and new environmental worries (MinnPost.com Jan 24, 2008) • Mining (Sierra Club, North Star Chapter)
Layoffs loom as Iron Range feels pinch of tough economy (MPR Dec 1, 2008) • Taconite piles up as Iron Range mines shut down (MinnPost.com)
In 2006, Minnesota’s nonfuel raw mineral production valued at $2.54 billion • $350 million, or 16%, increase from the State’s total nonfuel mineral value for 2005 • Nation’s leading iron ore producing State in 2006 about 80% of ore within the United States • Iron ore is the State’s leading nonfuel mineral, ca.85% of the total nonfuel mineral production value • Construction sand and gravel • Crushed stone • Industrial sand and gravel • Dimension stone • Lime • Peat • Common clays • Gemstones
6 producing iron ore mines in Northeast Minnesota capable of producing over 40 million tons of taconite annually • The iron mines directly contribute $1.8 billion to the economy of Minnesota every year in the form of purchases, wages and benefits, taxes, and royalties
6 producing iron ore mines in Northeast Minnesota capable of producing over 40 million tons of taconite annually • The iron mines directly contribute $1.8 billion to the economy of Minnesota every year in the form of purchases, wages and benefits, taxes, and royalties • Subsequent business impact induced as the result of iron mining is responsible for more than an additional $1.6 billion—making the total economic impact $3.1 billion on the state and region’s economy • Currently the mines directly employ approximately 3,000 men and women, with supporting an additional 1210,000 employed by vendors jobs
6 producing iron ore mines in Northeast Minnesota capable of producing over 40 million tons of taconite annually • The iron mines directly contribute $1.8 billion to the economy of Minnesota every year in the form of purchases, wages and benefits, taxes, and royalties • Subsequent business impact induced as the result of iron mining is responsible for more than an additional $1.6 billion—making the total economic impact $3.1 billion on the state and region’s economy • Currently the mines directly employ approximately 3,000 men and women, with supporting an additional 1210,000 employed by vendors jobs • Part of the direct impact to the economy includes taxes and royalties paid by the iron mining industry • Taxes payable in 2008 equaled $148.7 million • Distribution of those taxes included $56.9 million towards Minnesota’s education--$45.8 million to K-12 and $11.1 million to the University Trust Fund
Historical Overview • History of mining and quarrying in Minnesota (Upham,1898) • Iron Mining in Minnesota (Van Barneveld, 1912) • Timeline of Minnesota’s Iron Range (MPR)
Iron Mining • “Natural Ore” – Hematite • Taconite • Taconite (Wikipedia) • Taconite Mining and Processing Industry Profile (EPA, 2001) • Taconite (Minnesota Statutes) • Taconite (Minnesota Historical Society) • Iron Ore: Energy, Labor, and Capital Changes with Technology (1978) • Iron Ore: From Depletion to Abundance (1981) • Mining Minnesota (non ferrous)
State’s Role in Mining • State Mineral Leasing, Exploration, and Development (DNR) • Metallic Mineral Exploration and State Mineral Leasing in Minnesota (DNR) • State Nonferrous Metallic Minerals Leasing (DNR) • Minerals Management Account (DNR) • Revenue Received from State Mineral Leases FY 1890-2011 (DNR) • US Steel Keetac Taconite Mines Expansion Project Final Environmental Impact Statement (Nov 2010)
Minnesota Constitution Article X Taxation • Sec. 3. Occupation tax; ores. • Every person engaged in the business of mining or producing iron ore or other ores in this state shall pay to the state an occupation tax on the valuation of all ores mined or produced, which tax shall be in addition to all other taxes provided by law. The tax is due on the first day of May in the calendar year next following the mining or producing. The valuation of ore for the purpose of determining the amount of tax shall be ascertained as provided by law. Funds derived from the tax shall be used as follows: 50 percent to the state general revenue fund, 40 percent for the support of elementary and secondary schools and ten percent for the general support of the university.
Minnesota Constitution Article X Taxation Sec. 6. Taconite taxation. Laws of Minnesota 1963, Chapter 81, relating to the taxation of taconite and semi-taconite, and facilities for the mining, production and beneficiation thereof shall not be repealed, modified or amended, nor shall any laws in conflict therewith be valid until November 4, 1989. Laws may be enacted fixing or limiting for a period not extending beyond the year 1990, the tax to be imposed on persons engaged in • the mining, production or beneficiation of copper, • (2) the mining, production or beneficiation of copper-nickel, or • (3) the mining, production or beneficiation of nickel. Taxes imposed on the mining or quarrying of taconite or semi-taconite and on the production of iron ore concentrates therefrom, which are in lieu of a tax on real or personal property, shall not be considered to be occupation, royalty, or excise taxes within the meaning of this amendment.
Taconite Overview • Taconite – Digging into Minnesota’s past (DNR) • STEEL: Taconite Boom (Time April 28 1952) • 2 edges of technological progress: the case of Lake Superior iron mining (Federal Reserve Bank, Minneapolis)
Cliffs Natural Resources • An international mining and natural resources company • Largest producer of iron ore pellets in North America, a major supplier of direct-shipping lump and fines iron ore out of Australia and a significant producer of metallurgical coal • The North American business unit is comprised of six iron ore mines in Michigan, Minnesota and Eastern Canada, and two coking coal mining complexes in West Virginia and Alabama – in MichiganEmpire Mine and Tilden Mine, in Minnesota - Hibbing Taconite Northshore Mining and United Taconite
The Eveleth Expansion Company was formed in Minnesota in March 1976 as a partnership between, Virginia Horn Taconite Company, Ontario Eveleth Company, Dofasco Eveleth Corporation, and ONCO Eveleth Company. • The partnership was created to produce and deliver taconite pellets to a mining venture called the "Expansion Project," which was also a partnership between Eveleth Expansion Company and several large American and Canadian firms such as Armco Steel, Oglebay Norton, Eveleth Taconite, and Dominion Foundries and Steel, Ltd. • Eveleth taconite plant closes (MPR May 14 2003)
Gender Discrimination • North Country • “It was like they'd never seen a woman before” (Guardian Feb 3, 2006) • Lois E. Jenson v Eveleth Taconite Co. (FindLaw) Unofficial • Jenson v Eveleth Taconite (Wikipedia)
Essar Steel • Essar Steel Minnesota LLC plans to set up an integrated steel plant on the Mesabi iron range in northeast Minnesota • The estimated cost of the project is USD 1.65 billion; the plant will have an annual capacity of 2.5 million tonnes per annum (MTPA) when completed • The strategy is to combine a high-quality ore body with modern and commercially proven technology and develop a vertically integrated steel mill • It will be the first facility in North America to include iron ore mining, ore processing, direct reduction and steelmaking on a single site • Taconite Mining (Minnesota Center for Environmental Advocacy) • Essar Steel breaks ground on Nashwauk plant (MPR, Sept 19, 2008) • Judges consider Essar Steel Minnesota project impact on environment (Steel Guru July 21, 2009) Essar Steel Minnesota Modifications Project - Final Supplemental Environmental Impact Statement (DNR Dec. 2011)
Mesabi Nugget Project • Steel Dynamics and Kobe Steel Ltd. have partnered to construct and operate at Hoyt Lakes, Minnesota, the world's first full-scale demonstration plant using a pioneering process developed by Kobe Steel • This process promises to be both environmentally friendly and energy efficient, reducing emissions by more than 40 percent compared to current processes and using 30 percent less energy than integrated steelmaking • This plant is expected to produce high volumes of 97-percent-pure iron nuggets very cost-effectively • Mesabi Nugget Project (Minnesota DNR) • Mesabi Nugget announces delay in start-up (Minnesota Brown, May 23, 2009) • Mesabi Nugget taconite plant to start work soon ( Advantage Business Media Sept 29, 2009)
Duluth Metals Limited Canadian mineral exploration Corporation which has completed a number of preliminary economic assessments on a large, potentially bulk-mineable underground copper-nickel- deposit located in the Duluth Complex in northeastern Minnesota, USA The Nokomis Deposit is situated southeast of Ely Consists of approximately 3,000 acres of land in a combination of State Leases, a private mineral lease and Federal Prospecting Permits
Duluth, Missabe and Iron Range Railroad • Acquired on May 10, 2004 by the Canadian National Railway • when it purchased the assets of Great Lakes Transportation • Great Lakes Transportation LLCis a group of transportation related companies primarily consisting of rail and water carriers catering to the needs of the steel making industry centered around the Great Lakes. GLT companies include: • Bessemer and Lake Erie Railroad • Duluth, Missabe and Iron Range Railway • Great Lakes Fleet, Inc. • Pittsburgh & Conneaut Dock Company • Formerly owned by the privately-owned Transtar, Inc., GLT's rail and marine holdings were purchased in 2004 by the Canadian National Railway for $380 million. • Great Lakes Fleet operates eight Great Lakes bulk carriers ranging from 1,004 feet long to 767 feet long.
Silver Bay Silver Bay… before it was Silver Bay History of Silver Bay
Reserve Mining Company • History of Silver Bay • Northshore Mining originally operated as Reserve Mining Company, was the first taconite processing facility in North America when it opened in 1955. After Reserve filed for bankruptcy in 1986, the plant was downsized to 4.8 million tons per year capacity and reopened in 1990 as Northshore Mining Company. Now owned by Cliffs Natural Resources Chapter 2: The classic Reserve Mining case • U.S. v. Reserve Mining Co., 380 F. Supp. 11, 17 (D. Minn. 1974) Reserve Mining v EPA 514 F.2d 492 (8th Cir. 1975) • US v Reserve Mining (J Water Pollution Control Federation, 1976) Reserve Mining Co. v EPA • The legacy of the Reserve Mining case (MPR Oct 29, 2003) • Miles Lord calls for a halt to taconite projects (MPR Feb 23, 2005) • Company seeks to reopen 1970s Reserve Mining case (MPR July 31, 2007)
Financial Aspects of Iron Mining Minnesota Constitution Mineral Lands (Minnesota Statutes) Mining (Minnesota Statutes) Taxing Severed Minerals (Minnesota Statutes) Taxing Severed Minerals (Minnesota Statutes) Iron Ore Tax (Minnesota Statutes) Taconite and Iron Mining (Department of Revenue) Mining Tax Guide (Minnesota Department of Revenue) Mineral Taxes (Department of Revenue) Mining Tax Study (Minnesota Center for Fiscal Excellence)
Iron Range Resources • State of Minnesota economic development agency located in Eveleth, Minnesota • Mission is to advance regional growth by stabilizing and enhancing the economy of northeastern Minnesota's Taconite Assistance Area • Services includebusiness development consulting and financial assistance • Business Financing • Low Interest Business Loans • Economic Development Grants • Minnesota Business Opportunities • Tax-Free Commercial Real Estate • History of Agency
