The Essar Group will launch its $1.8 billion taconite plant in Nashwauk sometime next year -- with the state of Minnesota kicking in $66 million in loans and infrastructure bonds.
But riding along with the Iron Range's largest project in 40 years will be Essar's record of providing fraudulent environmental records to regulatory officials.
Essar also owns Frasure Creek Mining, one of Kentucky's biggest coal operators. Back in 2010, a coalition of environmental groups decided to analyze water testing reports the company submitted to state officials. And what they found appeared to be wholesale fraud.
Over a two-year period, Essar submitted 9,000 measurements that were simply copied-and-pasted from previous reports, showing that pollution runoff into waterways was well within permissible limits.
The company offered a novel excuse, claiming it simply made 9,000 inadvertent transcription errors. Kentucky slapped Essar with a $310,000 fine, but seemed to buy the excuse, clearing Essar of any environmental wrongdoing.
Still, the embarrassing episode forced Essar to submit legit water measurements over the coming years. When it played by the rules, the results weren't pretty. Discharge readings often exceeded legal limits by more than tenfold.
Fast forward to last year, when environmental groups once again analyzed what the company was telling the state.
The coalition found that Essar had returned to manipulating data. Of 282 monthly reports scrutinized, 210 were found to be complete or partial duplicates of past ones.
Mitchell Brunfelt, a spokesman for Essar Steel Minnesota, understands how people might be nervous seeing a company with such a besmirched corporate cousin opening shop here. But Brunfelt is quick to point out what differentiates Essar's Minnesota mine from those in Kentucky.
"... We are not discharging any processed water or storm water off of our property" in Minnesota, he tells CityPages. "This sets us distinctly apart from other area mining operations, which are required to have water discharge permits because they actually discharge water off of their sites."
Regardless, Suzanne Baumann of the Minnesota Pollution Control Agency, the regulators responsible Essar's Nashwauk operation, says the state will do its own testing.