DULUTH – When Minnesota Power’s largest industrial customers started shutting down due to the pandemic earlier this year, company leaders scrapped their earnings guidance and let investors know “we cannot predict at this time the extent and duration of the effects of COVID-19,” CEO Bethany Owen said in May.
Now the Duluth-based utility is looking at a brighter future as many miners go back to work on the Iron Range.
“We’re very pleased to report … significant improvements in planned production levels extending to the end of 2020,” Owen said during a call with investors Wednesday morning. “The majority of large power customers, including Minnesota Power’s three largest taconite customers, have nominated full production levels for the remainder of this year.”
On Wednesday parent company Allete Inc. reinstated its earnings guidance for 2020 in the range of $3.09 to $3.29, not far off initial estimates at the beginning of the year. The company reported profits of $3.59 per share in 2019.
Minnesota Power, with 145,000 customers across northeastern and central Minnesota, sells a majority of its electricity to a handful of taconite producers and paper mills.
After a wave of mine closures this spring that resulted in more than 1,700 layoffs, Northshore Mining, Minntac and HibTac have all indicated a return to production by the end of this week.
U.S. Steel’s Keetac operation will remain indefinitely idled, as will Duluth’s Verso paper mill.
Cleveland-Cliffs, which owns and operates Northshore, said in a July 30 earnings report that during the spring, “Our main concern then was preserving our liquidity during a time we were not able to ship steel to our clients in all markets we serve, and particularly in our main end-market, the automotive industry. As of today, our clients are back to healthy levels of operation.”
U.S. Steel has been restarting blast furnaces as the auto industry and construction fuel steel demand, resulting in return to full production at its Minntac mine at the end of July.
ArcelorMittal previously said HibTac planned to resume full production by Thursday.