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PolyMet receives permit from Minnesota for copper-cobalt-nickel mine

Houston — Exploration and development company PolyMet Mining has received a mining permit from the state of Minnesota for its planned copper, nickel and cobalt Northmet mine in the northeast of the state, the company said Thursday.

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Polymet said its permit is the first nonferrous mining permit to be issued by Minnesota and is "a crucial permit for construction and operation of the NorthMet Project." The Department of Natural Resources has also issued all other permits for which the company has applied including dam safety, water appropriations, takings, and public waters work permits, along with Wetlands Conservation Act approval, PolyMet said in a statement.

"We look forward to building and operating a modern mine and developing the minerals that sustain and enhance our modern world," said Jon Cherry, president and CEO of MolyMet, in the statement. "Responsibly developing these strategic minerals in compliance with these permits while protecting Minnesota's natural resources is our top priority as we move forward."

The mine is expected to produce 72 million lb (32,659 mt)/year of copper, 15.4 million lb/year of nickel, 720,000 lb/year of cobalt and 106,000 oz/year of precious metals in concentrate after it begins production in 2020.

PolyMet looks set to be the first company to bring copper, nickel and cobalt into commercial production in the "world-class" Duluth complex on the Iron Range's historic mining district. The mine is also expected to produce platinum group metals and gold as byproduct.

Cherry said the permit also provided a level of certainty the local community and investors had been seeking. "It is a victory for Iron Range families who have steadfastly supported us and who depend on and will benefit from the hundreds of jobs that construction and operations will create and support for years to come," he said. "This certainty will also allow the company to move forward with financing and final engineering designs."

As a result of the permits, PolyMet said site preparation and rehabilitation of the former LTV Steel Mining Company processing facilities, which the company acquired in 2005-06, will occur through the winter and early spring as the company prepares to modernize those facilities to process ore for the Northmet project. The bulk of work will start with the 2019 construction season and is expected to take 24-30 months and require about 2 million construction hours, the company said

An economic impact study by the University of Minnesota-Duluth Labovitz School of Business and Economics estimated the project will yield more than $500 million annually in economic benefits for St. Louis County and generate 660 indirect jobs in addition to the 360 full-time workers the company is expected to employ, PolyMet said.

Plans to develop this mine date back around 13 years, driven then by strong demand for nickel in stainless steel, cobalt in nickel-based superalloys for use in aerospace and industrial gas turbines and demand for PGMs for use in automotive cataysts. But in recent years, demand for battery materials, including nickel and cobalt, to fuel the electric-vehicle revolution has also become a driver for bringing this mine into production, PolyMet has said.

The company is looking to coordinate final financing, perhaps on a conditional basis, for the $1.2 billion project, spokesman Bruce Richardson said in August.

Some of that financing could come from Glencore, which advanced $80 million in cash to PolyMet on March 26 for detailed engineering and pre-construction work, Richardson said.

Glencore has agreed to take all of the mine's output for the first five years of its operation.

NorthMet will be built in two phases, costing an estimated $945 million and $259 million, respectively. -- Anthony Poole, anthony.poole@spglobal.com

-- Edited by Derek Sands, newsdesk@spglobal.com