Company aims to open $350M plant next year

A Minnesota company says it is making good progress toward opening within a year the $350 million factory in northern Indiana where it plans to produce iron ore pellets.

Magnetation Inc. of Grand Rapids, Minn., announced in late 2012 it would build the new factory at the site of an abandoned ethanol plant in the White County town of Reynolds. Several large buildings for the factory are under construction at the site about 25 miles north of Lafayette, the Journal & Courier reported.

The company's goal is to start operations there during the second half of 2014, said Terry Nanti, general manager of the Reynolds pellet plant.

The nearby rail lines that helped draw Magnetation to the Reynolds site also will need some work.

"We need to connect to the CSX line," Nanti said. "We've got a fair amount of infrastructure in place but no connectivity to the line. We've got to add about 7,000 more feet of rail internal to the site."

About 70 of the plant's anticipated 115 full-time workers have already been hired, and 90 percent of the full-time staff should be hired by March, he said.

The Magnetation site should be connected to the town's sewer and water utilities by April, said Randy Mitchell, president of White County Economic Development.

Mitchell said the project has energized the farming town after a 2005 plan promoted by then-Gov. Mitch Daniels to turn it into a hub of bioenergy fizzled out.

Daniels dubbed Reynolds BioTown USA and pledged to make it the first U.S. community to meet all electricity and gas needs through renewable energy, but the plan was hampered by changes in market conditions and financial problems among some developers.

"It provides the shot in the arm that we need," Mitchell said. "Not many localities can get an initial $350 million investment. This just seems to have the opportunity for satellite support businesses all throughout the county."

Magnetation picked the Reynolds site despite passage of a Minnesota law the company wanted to streamline environmental permitting for the new plant.

The company has said the new plant will process iron ore concentrate from northern Minnesota. The plant will produce iron ore pellets for West Chester, Ohio-based AK Steel Corp., which is a minority owner of the Magnetation subsidiary building the factory.