Kobe Steel and Steel Dynamics have agreed to build an iron making plant in Hoyt Lakes City, Minn. The facility will cost $235 million, and will be able to process around 500,000 tons of iron nuggets a year.
The new facility, using Kobe's ITmk3 processing technology, will start operation in mid-2009. The ITmk3 technology can produce high-grade iron nuggets quickly, meeting the requirements of electric furnace operators and mini-mills for the production of high-grade flat-rolled steels.
The technology can also reduce carbon gas emission by 20 percent.
Steel Dynamics will take 81 percent stake in a joint venture, Mesabi Nugget Delaware, which will handle production and sales of iron nuggets, while Kobe Steel will hold the remaining 19 percent.
SDI will buy all the output at the new plant for its mini-mills.
Kobe said it is also working on other commercial ITmk3 projects, including one in Michigan which it and Cleveland-Cliffs Inc are jointly studying.
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