Lee Schafer
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There’s a dramatic, multifront war underway for some iron mining land at the west end of the Mesabi Iron Range, and it’s not easy to even sort out who all is involved.

If you are looking for somebody to cheer for, though, that has to be the irresistible Lourenco Goncalves.

Goncalves is the quotable CEO of Cleveland-Cliffs Inc., a mining company that in December announced that it had bought or otherwise taken control of more than 3,700 acres of mining land by the town of Nashwauk that underlies the stillborn iron mining and processing project once known as Essar Steel Minnesota.

He put on a not-to-be-missed show for a roomful of Iron Rangers last week in downtown Eveleth, but his charisma isn’t the reason to pull for him. It’s because Goncalves is a miner with a track record, who, in just a few years in one of our state’s key industries, has delivered. That’s a welcome development, on the Iron Range and anywhere else in our state.

There seems to be plenty of room here for compromise and collaboration on the land, yet it could be good for the region if Goncalves gets at least some part of what he described last week — ore to keep this venerable company in business for decades.

The Nashwauk land controversy was clearly on the minds of people who dropped by the refurbished Eveleth Auditorium last week to catch Goncalves’ annual state of the company presentation. Not one to stick to his script, Goncalves wasn’t even willing to let his formal introduction pass without a remark.

To say he “joined” Cleveland-Cliffs as CEO in mid-2014 isn’t quite right, he said. He characterized it as breaking down the door and bursting inside, taking over after dissident shareholders grabbed control of the board of directors.

His new company maybe looked then to some like a bankruptcy candidate, he added. Goncalves slimmed down operations through moves like exiting the coal business and reducing net debt by about $1.9 billion since June 2014.

He’s played offense, too. About $50 million of the company’s 2018 capital budget will go into its Northshore Mining operation in Silver Bay to add capacity for what are called DR-grade pellets. These are much higher in iron content than traditional taconite pellets produced for blast furnaces.

Cleveland-Cliffs intends to use much of the pellet output in a plant it is creating in Ohio that will produce something called hot-briquetted iron. This product really does look a little like the briquettes backyard chefs light up to cook burgers. It will be used to make steel in an electric-arc furnace. It’s a $700 million project that won’t be producing until 2020, but the company has already raised the money to fund it.

Yet even with these initiatives, Goncalves called “the most important line” of his presentation the one that simply said the company just celebrated 170 years in business. Even United States Steel Corp. is a relative pup, he noted.

Staying power matters, too, because in the name of jobs Minnesotans continue to invest a lot of time and sometimes taxpayer money into northeastern Minnesota operations that either don’t stick around or don’t get going at all. Meanwhile, his company employs nearly 1,750 people there.

Lest anyone miss his point, he added, “I get offended when we get compared to people who don’t have any jobs.”

He was clearly talking about the bankrupt Essar Steel Minnesota. The Nashwauk project was years in the planning stage even before it broke ground in 2008, then it mostly went sideways until finally ending up in bankruptcy. It’s important to remember, though, that the people who promised a lot and never delivered were not the people now in charge of the project.

An investor from Virginia named Tom Clarke has put together a group to finish the project. Clarke has also brought new life to a northern Minnesota ore recovery operation that also had gone bankrupt. Goncalves, apparently unimpressed, sometimes refers to Clarke’s group as “Chewbacca,” from the tall and furry character in “Star Wars” films.

Never easy, Clarke’s challenge in reviving the project grew greater in December when Cleveland-Cliffs announced that it had acquired, leased or otherwise gained control of more than 3,700 acres of the land holdings important to the project.

Even lifelong Iron Rangers apparently didn’t know precisely what Goncalves had in mind, based on the reaction of the audience last week when he flashed up a map of the site. The best way to understand what this slide showed is to imagine a big quilt made up of many yellow and gray pieces of fabric, distributed roughly equally across the whole quilt.

Cleveland-Cliffs now has control of all the yellow pieces.

It’s impossible to imagine how anyone could run an efficient mining operation on just the yellow land or just the gray land.

Cleveland-Cliffs may not keep control of its parcels, as these transfers are being hotly disputed by Clarke’s company in a Delaware court. The company in a filing described the move as anti-competitive and improper mischief and said the transfers violated a previous court order.

On the other hand, Goncalves and Cleveland-Cliffs have a legitimate story here, too. Cleveland-Cliffs owns roughly a quarter of Hibbing Taconite and runs the operation just up the road from the Nashwauk site. Hibbing Taconite is going to run out of ore within seven or eight years.

Robb J. Bigelow, an executive with Clarke affiliate ERP Iron Ore, declined to comment on the court case, but described the executive team as “a bunch of collaborators” happy to discuss some form of partnership for the land or ore.

When Goncalves met with reporters last week in Eveleth, he did not sound nearly as flexible. The one deal he’d be interested in is Cleveland-Cliffs selling DR-grade pellets to Clarke and ERP if they wanted to build an iron processing plant at Nashwauk. There was no hint that he was planning on trading away any rights to the newly acquired land.

When meeting with Cleveland-Cliffs employees last week, “I made it abundantly clear I want to hire their sons and daughters and their grandsons and their granddaughters,” Goncalves said. “What we are doing here is not for the next quarter on Wall Street. What we are doing here is to make Cleveland-Cliffs successful for the next 50 years or more.”

lee.schafer@startribune.com 612-673-4302