NEW YORK Essar Steel Minnesota LLC has postponed the opening of its taconite plant and iron ore processing facility in Nashwauk, Minn., until the second half of 2014.
The taconite mine is currently under construction and was scheduled to start operations this fall.
The opening is being delayed due to financing issues surrounding the companys decision to increase annual production to 7 million tons from 4 million, Madhu Vuppuluri, president and chief executive officer, told the Star Tribune.
The company originally planned to spend $1.1 billion on the project, but that has increased to $1.7 billion.
Essar Steel Minnesota, Hibbing, Minn., is "at the advanced stages of" securing the additional $600 million needed to finish the project, Vuppuluri said.
The company earlier this year signed an offtake agreement to supply 3.5 million tonnes per year of iron ore pellets to ArcelorMittal USA Inc., Chicago (amm.com, Feb. 11). That deal will last for 10 years.
Essar Steel Minnesota didnt respond to a request for comment.
A version of this article was first published in AMM sister publication Steel First.