United States Steel Celebrates Opening of DR-Grade Pellet Production Facility in Minnesota

Rhea-AI Summary

U.S. Steel (NYSE: X) announced the opening of its new direct reduced (DR)-grade pellet production facility at its Minnesota Ore Operations-Keetac Plant. The $150 million investment enables the plant to produce approximately four million tons of pellets annually, addressing the growing demand for low-cost DR-grade iron ore. The facility also offers flexibility to produce blast furnace pellets, adapting to market changes. The project, completed ahead of schedule and under budget, created 250 construction jobs and 33 full-time positions, emphasizing U.S. Steel's commitment to quality and sustainability. Minnesota Governor Tim Walz and U.S. Steel's CEO David B. Burritt celebrated the launch, highlighting the project's potential to strengthen Minnesota's iron ore industry.

Positive

• The $150 million investment enhances U.S. Steel's competitive edge in low-cost iron ore production.
• The facility can produce up to four million tons of DR-grade pellets annually, meeting rising market demand.
• Flexibility to produce either DR-grade or blast furnace pellets enhances market adaptability.
• The project was completed ahead of schedule and under budget.
• Created 250 construction jobs and 33 full-time union and management positions.
• Reinforces U.S. Steel's commitment to sustainability and high-quality products.

Negative

• The significant capital investment of $150 million may impact short-term financial liquidity.
• Potential market volatility could affect the demand for DR-grade pellets, impacting revenue projections.
• Operational challenges in maintaining dual production capabilities might arise.

The $150 million investment expands on the Company’s existing competitive advantage in low-cost iron ore

KEEWATIN, Minn.--(BUSINESS WIRE)-- U. S. Steel (NYSE: X) (“U. S. Steel”) today celebrated the launch and operational readiness of its direct reduced (DR)-grade pellet production facility at its Minnesota Ore Operations-Keetac Plant. Having already confirmed the first shipment of DR-grade pellets, the Keetac facility is on track to deliver approximately four million tons of pellets annually. The $150 million investment marks a step forward in U. S. Steel’s metallics strategy by supplying the increasingly tight DR-grade pellet market with low-cost iron ore and building on the company’s ability to meet customer needs.

Minnesota Governor Tim Walz; David B. Burritt, President and CEO of U. S. Steel; Kristen Vake, Executive Director, Iron Mining Association of Minnesota; and Travis Kolari, Head of Operations, U. S. Steel Minnesota Ore Operations cut the ribbon on U. S. Steel's new DR-Grade pellet plant. (Photo: Business Wire)

The new production facility will maintain optionality, able to produce either DR-grade iron ore pellets or blast furnace iron ore pellets, allowing the Company to adjust to changing market conditions. Minnesota Governor Tim Walz and other elected officials joined the celebration, along with U. S. Steel President and CEO David B. Burritt, Senior Vice President - Raw Materials and Sustainable Resources John Gordon, employees, and members of the community.

“This project was completed ahead of time, under budget, and most importantly, safely. Plus, it created 250 construction jobs and 33 full-time union and management jobs,” said Burritt. “This is an incredible achievement for our team at Keetac and for U. S. Steel, as we continue to produce the highest quality products: mined, melted, and made right here in the USA.”

“U. S. Steel’s new pellet facility is a smart investment in the people and potential of the Iron Range,” said Governor Walz. “This project is a win-win. We’re creating jobs, lowering emissions, and ensuring Minnesota’s iron ore industry remains strong for generations.”

Construction on the DR-grade pellet facility began in August of 2022 and was completed in December of 2023. U. S. Steel’s Minnesota Ore Operations directly employs nearly 2,000 workers.

About U. S. Steel

Founded in 1901, United States Steel Corporation is a leading steel producer. With an unwavering focus on safety, the Company’s customer-centric Best for All^® strategy is advancing a more secure, sustainable future for U. S. Steel and its stakeholders. With a renewed emphasis on innovation, U. S. Steel serves the automotive, construction, appliance, energy, containers, and packaging industries with high value-added steel products such as U. S. Steel’s proprietary XG3^® advanced high-strength steel. The Company also maintains competitively advantaged iron ore production and has an annual raw steelmaking capability of 22.4 million net tons. U. S. Steel is headquartered in Pittsburgh, Pennsylvania, with world-class operations across the United States and in Central Europe. For more information, please visit www.ussteel.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240523633782/en/

U. S. Steel Media Relations

T - (412) 433-1300

E - media@uss.com

Source: United States Steel Corporation

FAQ

What is the significance of U.S. Steel's new DR-grade pellet production facility?

The new facility enhances U.S. Steel's ability to produce low-cost DR-grade iron ore pellets, meeting growing market demand and ensuring flexibility in production.

How much did U.S. Steel invest in the new DR-grade pellet production facility?

U.S. Steel invested $150 million in the new DR-grade pellet production facility.

How many jobs were created by the new U.S. Steel DR-grade pellet production facility?

The project created 250 construction jobs and 33 full-time union and management positions.

What is the production capacity of U.S. Steel's new DR-grade pellet facility?

The facility has a production capacity of approximately four million tons of DR-grade pellets annually.

When was the construction of U.S. Steel's new DR-grade pellet production facility completed?

Construction began in August 2022 and was completed in December 2023.

How does the new facility impact U.S. Steel's market position?

The facility strengthens U.S. Steel's market position by enhancing its ability to produce low-cost DR-grade iron ore pellets and adapting to changing market conditions.