MagIron LLC has completed a concept and economic study conducted by Primetals Technologies to assess the development of large-scale granulated pig iron production at its existing facilities in the United States. The study evaluated three production routes: MIDREX Flex direct reduction followed by electric smelting; MIDREX Flex direct reduction followed by electric arc furnace and ladle furnace processing; and conventional blast-furnace production.
According to the study, all three routes provide technically viable pathways to producing approximately two million tonnes of granulated pig iron annually. MagIron said the project could establish a significant domestic source of high-quality iron units for US steelmakers and support efforts to strengthen the country’s steel supply chain.
The preliminary study estimates capital expenditure of approximately $1.6 billion to $2.3 billion for the main ironmaking and granulation facilities. Operating cash costs are estimated at approximately $305 to $345 per tonne of granulated pig iron, before by-product credits and excluding carbon costs, capital charges and certain corporate and financing expenses.
Based on the study and its own financial analysis, MagIron estimates the project could generate annual EBITDA of between $400 million and $500 million across the commodity cycle. The company plans to make use of its existing mining, processing, pelletising and logistics infrastructure, which has an estimated replacement value of approximately $1.3 billion. MagIron said this infrastructure could reduce development costs and shorten construction timelines compared with a completely new project. The company controls an estimated 2.6 billion tonnes of iron ore resources, providing a long-term raw material base for future production and expansion.
Julian Treger, Executive Chairman of MagIron, said the completion of the Primetals study confirms several potential routes for establishing domestic merchant pig iron production. He added that the company will continue advancing its pig iron strategy while retaining the option to supply direct-reduction-grade pellets when market conditions support such an opportunity.
The company said the US currently imports essentially all of its merchant pig iron requirements, creating exposure to international supply chains. MagIron estimates that annual US merchant pig iron consumption has historically been between four million and six million tonnes. Its proposed two-million-tonne annual production capacity could therefore supply around one-third to one-half of current demand.
MagIron said its location provides access to domestic steelmaking customers and logistics infrastructure. Domestic production could reduce transportation distances and exposure to maritime and port disruptions compared with imported material. The direct-reduction routes evaluated in the study would initially use natural gas and could allow greater use of hydrogen as competitive hydrogen supplies and infrastructure become available.
Friedemann Plaul, Senior Vice President, Iron- and Steelmaking and ECO Solutions at Primetals Technologies, said the study demonstrated that large-scale granulated pig iron production could be achieved through several technology routes. MagIron will now work on selecting a preferred technology route and production site while engaging customers, technology providers, government agencies, financing partners and other stakeholders.
The company is also progressing plans to restart its iron ore concentrator near Grand Rapids, Minnesota, and pelletising plant near Reynolds, Indiana. The facilities have received more than $660 million of prior investment and were previously designed to operate at an annualised rate of about 2.2 million tonnes of blast-furnace-grade concentrate.
