International Steel Group Inc. has completed the purchase of substantially all of the assets of the Cliffs and Associates Limited (CAL) Circored^® Hot Briquetted Iron (HBI) facility located in Trinidad and Tobago, for a purchase price of $8 million in cash, plus assumed liabilities. CAL may receive up to $10 million in future payments contingent upon production and shipments.

The facility has the capacity to produce approximately 500,000 tonnes of HBI annually. The HBI process uses natural gas to reduce iron ore fines and yields a low-cost scrap steel substitute that can be used in both electric arc furnace and traditional blast furnace steelmaking. HBI can also be used to increase the efficiency of blast furnaces and thereby reduce the use of coke.

The Trinidad and Tobago HBI project began in the mid-1990s as a joint venture among Cleveland-Cliffs, Lurgi Metallurgie (now known as Outokumpu Technology GmbH), and LTV Steel. Production began in 2000, but ceased a year later as a result of depressed global scrap iron and HBI prices, changes in the makeup of the joint venture, and other factors. Now that the purchase has been completed, ISG expects to begin HBI production at the facility during the fourth quarter of 2004.

"Consistent with our focus on developing our raw materials capabilities, we are committed to restarting and operating the HBI facility in Trinidad and Tobago as soon as possible," said Rodney B. Mott, ISG's President and CEO. "This facility is strategically located near natural gas reserves, which provide an inexpensive source of energy for the production of HBI."

The license to the Circored technology will transfer to ISG.

International Steel Group Inc. is one of the largest steel producers in North America. It produces a variety of steel products including hot-rolled, cold-rolled and coated sheets, tin mill products, carbon and alloy plates, rail products and semi-finished shapes to serve the automotive, construction, pipe and tube, appliance, container and machinery markets.

Headquartered in Cleveland, Ohio, Cleveland-Cliffs Inc. is the largest producer of iron ore pellets in North America, selling the majority of its pellets to integrated steel companies in the United States and Canada. The company operates six iron ore mines located in Michigan, Minnesota and Eastern Canada.