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Debt Financing Approved for Mesabi Nugget Plant

09/27/2004 - Larry Lehtinen, President of Mesabi Nugget, LLC (MNC) announced that Mesabi Nugget, LLC has reached agreement with the State of Minnesota on $20 million of project debt financing for the Erie Nugget Plant to be located near Hoyt Lakes, Minn.

Larry Lehtinen, President of Mesabi Nugget, LLC (MNC) announced that Mesabi Nugget, LLC has reached agreement with the State of Minnesota on $20 million of project debt financing for the Erie Nugget Plant to be located near Hoyt Lakes, Minn.

Mesabi Nugget has also commenced detail engineering for the long delivery time components of the facility.

MNC expects permitting and other commercial arrangements to be completed such that equipment supply contracts can be concluded and construction can begin at the Erie Nugget site by April 2005.

This schedule would allow iron nugget production to start by September 2006.

The Iron Range Resources (IRR) Agency board approved a $10 million loan on September 23, 2004. A second $10 million loan from the Minnesota Minerals 21st Century Fund, which is administered by the Minnesota Department of Employment and Economic Development (DEED), is part of the package offered by the State of Minnesota for the Erie Nugget commercial iron nugget plant.

The Erie Nugget Plant would be the first large-scale commercial plant to use the Kobe Steel ITmk3 Process® for the production of pig iron nuggets for sale to steelmakers and foundries.

Permit applications for the Erie Nugget Plant of MNC will be submitted to the Minnesota Pollution Control Agency and the Minnesota Department of Natural Resources in October 2004.

Definitive documents for the State of Minnesota loans are subject to final approval by Iron Range Resources, DEED and Mesabi Nugget, LLC.

Mesabi Nugget, LLC is a Minnesota limited liability company organized for the purpose of developing value added iron projects utilizing the revolutionary new ITmk3 iron nugget process owned by Kobe Steel, Ltd.