News and Events


Twin Ports High on Short List for LNG Plant Investment

Thursday, July 03, 2014


 

Photos: Stacey Phillips (Left), Nancy Norr (Right)

The Northland’s next big investment may be in the industrial sector and could total up to $70 million.

Thanks to the region’s significant mining, pipeline and transportation infrastructure, a major developer of plants that convert natural gas into liquid has placed Duluth-Superior high on its list of potential development sites.

“We have identified several areas in and around the Great Lakes region. The Duluth and Superior area is probably our number one choice,” said Stacey Phillips, director of business development at WesPac Midstream LLC, who made the comment at a May conference in Superior.

Liquefied natural gas, also called LNG, is already being used in some countries as a replacement for diesel fuel. Its benefits currently are being studied by several industries in the United States, where a plentiful supply has become available through new fracking technology.

“It would offer a triple-bottom-line benefit in our area,” said Nancy Norr, director of regional development at Minnesota Power. “There would be a direct investment of $50-$70 million to build a liquefaction plant, there’s a cost benefit to users, and there are environmental benefits,” explained Norr, who participates in a regional LNG strategy group.

Using LNG as a replacement for diesel fuel is of particular interest to the maritime shipping industry, which faces federal pressure to reduce cargo vessel smokestack emissions. Some older ship engines burn a heavy type of diesel fuel that generates much more air pollution than other diesel and gas power plants. The Great Lakes Maritime Research Institute (GLMRI) has been studying LNG as an alternative maritime fuel for several years because its environmental profile would meet today’s strict pollution limits. The group is a consortium of the University of Wisconsin – Superior Transportation and Logistics Research Center, the University of Minnesota Duluth Swenson College of Science and Engineering and the Labovitz School of Business and Economics.

But there are many more applications. LNG also can be used by the rail industry in train locomotives, by the mining industry in large trucks and pumps, by over-the-road trucking companies, and by the agriculture industry for applications such as drying grains.

“When you look at the long-term fuel cost savings and the environmental benefits, the LNG industry can make a real compelling case,” said APEX President and CEO Brian Hanson, who also works with the strategy group. “It’s hard to say which industry will embrace LNG first.”

Liquid vs. gas

Although LNG offers many advantages, the fuel can’t be dispensed with the same ease as gasoline or diesel fuel, which typically are in a liquid state. Natural gas doesn’t become a liquid until it’s chilled to -260 degrees. That temperature can only be attained at a liquefaction plant, and it can only be maintained in special tanks for a limited time period. Construction costs begin at about $50 million for a small plant such as the facility that California-based WesPac plans to build.

Before investing that amount of money, WesPac needs an anchor customer willing to make a long-term LNG purchase commitment. Regionally, the company hopes to develop maritime customers. It envisions having six Great Lakes facilities between Duluth and Quebec City, which would ensure commercial vessels can be refueled throughout the St. Lawrence Seaway system. Changing fuels is nothing new to the maritime shipping industry, according to Dr. Richard Stewart, director of the Transportation and Logistics Research Center at UWS and co-director of the Great Lakes Maritime Research Institute.

“We’ve done it several times on the Great Lakes,” he said in a 2012 presentation. “When we converted to oil, it cost a lot of money to convert these ships. We had to tear out the engines, change the bunker system and train the crew for new safety procedures. It was a big deal.”

But such conversions invariably are worthwhile, he added.

LNG “has tremendous environmental benefits, very strong cost advantages on fuel and maintenance. There’s a major market potential for conversion,” he said.

The Twin Ports poses one problem for WesPac: The shipping season is only nine months long.

“We can’t be shut down for three months of the year,” Phillips said, so proponents are working to identify additional customers to create a year-round LNG market.

Mining companies

Iron Range mining firms consume massive amounts of energy and, like maritime shipping companies, frequently face intense scrutiny by environmental regulators. Although it produces less energy per gallon (86,000 BTUs compared with 139,000 for diesel), LNG’s price advantage more than makes up for the difference (LNG was $2.50 per gallon this spring versus $3.91 for diesel).

“A gallon of diesel is burned for every ton of iron ore produced. That’s 40 million gallons of diesel consumed each year,” Norr said. “That’s attracting (LNG) developers to us.”

New mining operations such as Essar Steel Minnesota or PolyMet are the best LNG candidates, Hanson said.

“They wouldn’t face conversion costs because they’ll be buying equipment that is new – new pumps, new conveyors and mobile applications such as trucks,” he said.

Essar is monitoring the LNG movement, said Kevin Kangas, director of government and public affairs at the company’s Nashwauk taconite mine and processing plant, which currently is under construction.

“It offers the potential to reduce operating costs,” he said, although makers of heavy equipment (such as the 240-ton trucks used in iron mines) have not yet completed the LNG testing phase. “We’re in discussions with Caterpillar on how to incorporate LNG into our fleet, initially on a trial basis and perhaps permanently in the future. We’ve thought about it and we’re interested.”

Other customers

Potential LNG buyers could also be “stranded plants” that currently are not served by natural gas because of their distance from the nearest pipeline, Norr said. If natural gas is delivered in liquid form (as LNG), it would be compressed 600 times and would expand by that amount when converted back to a gas and injected into a remote pipeline.

“Natural gas does not extend throughout all of Northeast Minnesota. Along the North Shore, it extends to Silver Bay but not further north. There are a number of stranded industrial sites that don’t have access to natural gas that could be users as well,” she said. It could be delivered in tanks transported by truck or, where track is available, by rail.

Hanson conceded that acceptance won’t be immediate or universal. Some people have safety concerns, and others oppose every type of fossil fuel.

“We believe it’s a very safe fuel. If it is released, the vapors will rise and dissipate,” Phillips said. A LNG liquefaction plant has operated for decades in Wrenshall without incident. It doesn’t distribute the product to the public but converts natural gas to liquid so it is available for distribution into pipelines during peak demand periods.

In terms of environmental impact, Hanson argued LNG is a good choice when compared with other fossil fuels.

“If you’re going to burn a fossil fuel, natural gas converted to liquefied natural gas is a very good choice,” he said. “There are those who say ‘no’ to all fossil fuels and to natural gas fracking. We’re not going to be able to answer that question, but I believe interest in LNG is going to continue. It’s an industry with an excellent record. It’s going to happen.”

 


APEX Elects New Officers

Monday, June 09, 2014
At the APEX May Board of Directors Meeting, the following Executive Committee officers were elected:

The new committee members join the following officers:


AAR Celebrates 100th Aircraft Completion

Monday, June 09, 2014
Investor-member, AAR Corp. celebrated the completion of its 100th aircraft at its Stebner Road facility on April 29, 2014. AAR chose Duluth in November of 2012 and currently occupies the former Northwest Airlines maintenance facility. After only 18 months, AAR is elevating its impact to new altitudes:

  • Annual economic impact on the state of $47 million
  • Employs 310 at the Duluth repair and overhaul (MRO) facility
  • Recently signed a five year contract with Air Canada which includes renewable options
AAR Aviation Services Group Vice President, Dany Kleiman affirmed that locating in Duluth was the right choice and that the investment is paying off. Kleiman also announced AAR’s new long-term deal with Air Canada that secures AAR’s presence in Duluth for the foreseeable future.

"We knew from the first meeting with AAR that they would be a great fit for our region," said Brian Hanson, APEX President and CEO. "Aviation manufacturing in Duluth is predicted to grow by 40% over the next five years. AAR plans to continue hiring as they prepare to launch a fourth line of operations in the next year," continued Hanson.

Most recently, AAR was named Best Airframe MRO Provider in the Americas at the 2014 Aircraft Technology Engineering & Maintenance Awards ceremony held in London on May 7, 2014.

APEX Welcomes New Member Foth

Monday, June 09, 2014
APEX is pleased to announce Foth Infrastructure & Environment, LLC joined APEX as the latest investor-member. Foth expanded the company’s regional presence by opening a new office in the Missabe Building in Duluth. The company, with offices in 18 US locations, offers infrastructure, environment and production solutions to government, industrial and commercial clients across the country and throughout the world. Please welcome Foth to the region and to APEX.

APEX Organizational Update

Monday, June 09, 2014
In May, APEX announced several staffing changes within the organization. After close to four years at APEX, Elissa Hansen accepted a position with Lake Superior Consulting as the Director of Marketing and Business Development. Hansen's efforts were recognized at the May Board of Directors meeting by Brian Hanson, APEX President and CEO, "We'd like to wish Elissa success in her new position at Lake Superior Consulting and thank her for all she helped accomplish at APEX. Her tenacity, marketing and communication skills and quality of work will be missed."

APEX is also pleased to announce two new team members and highlight the promotion of two internal staff members:

Nick Larson joined APEX mid-May as a Business Developer. He will support the Itasca Economic Development Corporation (IEDC) in Grand Rapids, MN and lead other APEX attraction and expansion initiatives. Larson is a native of Duluth and a 2009 UMD graduate with majors in Finance and Organizational Management and a minor in Marketing. He has held various positions in the financial services industry with a focus on client service and investment operations. Most recently, Nick performed trade settlement analysis at a hedge fund in Minnetonka, MN.

Ian Vincent, the most recent APEX Development Intern, joined the APEX organization full time as a Business Developer. In his ten months of service, Vincent has contributed significantly to the Heat Treating, Plating & Powder Coating business retention and expansion strategy, supported GROW Minnesota efforts and was integral in the development and launch of NORTHFORCE.org: Your Talent Community. Vincent is a 2012 UMD graduate with a major in Accounting. He also holds a Bachelor of International Business in Marketing from the Grenoble Graduate School of Business in Isere, France.

Karl Schuettler has been promoted from APEX Administrative Intern to Development Intern. Schuettler joined APEX in early 2014. Schuettler will be responsible for supporting the business development activities of the organization in his new role. Schuettler is a graduate of the Georgetown University School of Foreign Service, with a major in Regional and Comparative Studies. Schuettler also works at the Duluth Public Library and is a freelance writer who covers high school hockey and Duluth-area current events.

Kolton Sundland joined APEX as the Administrative Intern in early June. Sundland will be responsible for administrative activities throughout the summer that support the APEX mission. Sundland will be a senior at the University of Minnesota Duluth pursuing a major in Organizational Management with a minor in Communication. While attending college in Duluth, he has worked in various capacities to help develop communication, customer service and teamwork skills.

"The recent changes within the organization position APEX well as business and economic development professionals working closely with our partners and clients," stated Brian Hanson, APEX President and CEO. "We are excited to welcome both Nick and Kolton and promote Ian and Karl - these young professionals will continue to build on APEX's knowledge of key industries and momentum for strategies that drive investment in our region," continued Hanson.

Attraction and Expansion Updates

Monday, June 09, 2014
At the May Board of Directors meeting, APEX Chair Dan Markham, shared several regional success stories involving APEX investor-members. APEX staff monitors regional and statewide news publications and captures these stories on the APEX website. See the most recent coverage of APEX investor-members in the news.

Brian Hanson, APEX President and CEO, shared an update on the organization’s deal sheet with investor-members at the May meeting. Hanson and the team also walked through a presentation with the Board regarding most recent attraction and expansion developments – a list that spans across several industries, including manufacturing, renewable energy and professional services, demonstrating the increased diversity in the economy.

International Metallics Corporation

On Wednesday, April 2, 2014 the City of Superior Common Council adopted a resolution approving a two-part agreement that will allow development activities to continue on a proposed manufacturing facility at the Parkland Industrial site in Superior, WI. The Option Agreement allows International Metallics Corp (IMC) and IMC Holdings, LLC – its Wisconsin-based subsidiary – the option to purchase the property for a facility manufacturing Hot Briquetted Iron (HBI) and Direct Reduced Iron (DRI). The Development Agreement specifies the terms of the development if IMC elects to exercise the property option.

IMC will continue ongoing assessment through the project development phase, including preliminary engineering, commercial and environmental analyses to determine the feasibility of the site for the manufacturing facility.

"We are pleased that IMC's project development efforts continue to move forward,” said Brian Hanson, APEX President and CEO. "The Parkland Industrial site has a great set of attributes to support this proposed DRI/HBI project, including proximity to energy and raw materials, excellent regional transportation infrastructure and strong State and local support - all key drivers that have attracted IMC's investment in the region."

The proposed $800 million facility would use a special grade of iron ore pellets from Minnesota’s Iron Range and natural gas from North Dakota to “reduce” the iron ore to metallic iron pellets, called DRI – Direct Reduced Iron. These pellets would be further compressed while hot into “briquettes” of highly metallized iron, Hot Briquetted Iron (HBI), and then sold to steel mills, where they are melted to make steel. HBI is a highly desirable product in modern steelmaking. To learn more about the DRI/HBI process, see IMC's fact sheet here.

Numerous public and private sector parties are involved in assisting IMC with advancing the DRI/HBI project, including Douglas County, the City of Superior, the Duluth Seaway Port Authority, APEX and The Development Association.

Data Center World
In late April, APEX joined investor-members Involta and Great River Energy and 10 regional and statewide public and private-sector partners at Data Center World in Las Vegas. Data Center World is a conference for data center and facilities management professionals. The educational conference connects industry leaders, engineers and technicians from across the world.

SME (Society for Mining, Metallurgy and Exploration) Conference In mid-April, APEX attended the SME conference held in Duluth, MN. Professionals and best practices from the mining industry were highlighted during the educational sessions. This is the second year that APEX has attended the show. It was in 2013 that Direct Reduced Iron (DRI) was initially identified as a viable opportunity for the region. Since that time, APEX has invested significant resources in the strategy to attract a DRI project and is currently working with International Metallics Corporation, in addition to several other prospects exploring the region.

Minnesota High Tech Association
On May 6, 2014, APEX attended the MHTA spring conference in Minneapolis. The annual event tailored to the technology industry and STEM (Science, Technology, Engineering and Mathematics) fields, featured several industry and statewide leaders and a track devoted to workforce development solutions in Minnesota. Example solutions include incentivizing students to complete industry certifications and credentials. Minnesota is a leader among states expanding internships, such as the MHTA SciTechsperience program. The program connects college students in STEM majors with paid internship opportunities in small to mid-sized companies in Minnesota. Interns participate in hands-on learning, solving real world business challenges – the kind of experience that helps students transition from classroom to career. For every intern a qualified company hires through SciTechsperience, a company will receive a dollar for dollar matching stipend to help cover 50% of the intern’s wages. Find more information on the MHTA website.

Progress Minnesota Event
APEX sponsored and attended the Progress Minnesota event on April 10, 2014, put on by Finance & Commerce in Minneapolis. The event honored 33 individuals and companies that drive growth and economic development throughout the State of Minnesota. APEX had the opportunity to present the award that recognized Dan Dorman, Executive Director of the Greater Minnesota Partnership, a nonprofit corporation devoted to advocating for state economic development policies and resources that benefit Greater Minnesota.

"Dan Dorman has been an incredible champion for economic growth and broadband expansion in Greater Minnesota. We're thrilled to present the prestigious award to him for his leadership," stated Brian Hanson, APEX President and CEO. The Partnership consists of businesses, chambers of commerce, economic development authorities, cities and nonprofits throughout Greater Minnesota.

AMFA Golf Social
On Tuesday, June 17, the Arrowhead Manufacturers and Fabricators Association (AMFA) will host the nonprofit’s annual golf outing at the Cloquet Country Club. Supporting and strengthening the manufacturing sector is a focus of APEX’s attraction, expansion and retention efforts. Consider sponsoring or golfing in the scramble event to support the AMFA-Educational Trust.

In addition, APEX also recently sponsored and/or participated in:
  • Regional Economic Indicators Forum Breakfast
  • UMD’s Labovitz School of Business and Economics Student Showcase
  • UMD Dinner with Champions
  • Northland Job Fair
If APEX investor-members would like to review the deal sheet or would like additional information about events APEX has participated in, please contact Sandy Johnson to arrange a meeting.

NORTHFORCE: Your Talent Community

Monday, June 09, 2014
In early February, APEX, the Northspan Group and several regional public and private partners launched NORTHFORCE, an innovative and intentional talent community strategy to invigorate the workforce in northeast Minnesota and northwest Wisconsin. The mission of the collaborative is to attract, manage, place, enrich and retain the regional talent community.

NORTHFORCE aims to continue seeking broad-based business and individual participation during the second and third quarters of 2014. Since launching in February, NORTHFORCE has registered 695 total members, including 185 employers. Approximately 350 positions are listed, and 96% of registrants have opted to share information, which will aid the organization in making effective matches with employers. Three out of five NORTHFORCE job seekers hold either a bachelor’s or master’s degree, validating NORTHFORCE's mission to attract, place and retain the region’s talent community.


Financial support for www.NORTHFORCE.org is provided by the City of Duluth, City of Superior, Iron Range Resources and Rehabilitation Board, and investor-member ALLETE/Minnesota Power. Investor-member The Northspan Group is responsible for database development and management and APEX is managing the outreach and marketing strategy. Twin Ports Connex is a recent addition to the NORTHFORCE team, working to attract and retain young adults regionally by helping them succeed economically.

Register your organization and promote career opportunities today at www.NORTHFORCE.org. For questions about NORTHFORCE, contact Anna Tennis at anna@NORTHFORCE.org or Ian Vincent at ian@apexgetsbusiness.com.

Local Talent Recognized and Retained with Staffing Changes at APEX

Tuesday, May 20, 2014

At a glance:

  • Nick Larson joins APEX as a Business Developer
  • Ian Vincent, recent APEX intern, joins APEX full time as a Business Developer
  • Karl Schuettler was promoted from APEX Administrative Intern to Development Intern

Duluth, Minnesota: The Area Partnership for Economic Expansion (APEX) recently announced staff additions and promotions within the regional, business and economic development organization.

Nick Larson joins APEX as a Business Developer. He will support the Itasca Economic Development Corporation (IEDC) in Grand Rapids, MN and lead other APEX attraction, expansion and retention initiatives. Larson is native to Duluth and a 2009 UMD graduate with majors in Finance and Organizational Management and a minor in Marketing. He has held various positions with a focus on client service and investment operations. Most recently, Nick performed trade settlement analysis at a hedge fund in Minnetonka, MN.

Ian Vincent, the most recent APEX Development Intern, joined the APEX organization full time as a Business Developer. In his ten months of service, Vincent has contributed significantly to the Heat Treating, Plating & Powder Coating business retention and expansion strategy, supported GROW Minnesota efforts and was integral in the development and launch of NORTHFORCE.org: Your Talent Community. Vincent is a 2012 UMD graduate with a major in Accounting. He also holds a Bachelor of International Business in Marketing from the Grenoble Graduate School of Business in Isere, France.

Karl Schuettler has been promoted from APEX Administrative Intern to Development Intern. Schuettler joined APEX in early 2014. Schuettler will be responsible for supporting the business development activities of the organization in his new role. Schuettler is a graduate of the Georgetown University School of Foreign Service, with a major in Regional and Comparative Studies. Schuettler also works at the Duluth Public Library and is a freelance writer who covers high school hockey and Duluth-area current events.

“The recent changes within the organization position APEX well as business and economic development professionals while working with our clients,” stated Brian Hanson, APEX CEO. “We are excited to welcome Nick and promote Ian and Karl – these young professionals will continue to build on APEX’s knowledge of key industries and momentum for strategies that attract, expand and retain businesses that align well with our regional strengths and opportunities,” continued Hanson.


Data Center Privacy, Security & Compliance Lunch & Learn

Tuesday, May 06, 2014

 

Is Your Data Secure? Is your Business Safe? Join Involta to discuss how to prepare your organization against data breaches.

We will discuss actual 2013 breaches and how they could have been avoided. Involta will also provide perspective on how to properly allocate technology and financial resources to ensure data security and compliance for your organization.

The event will take place Thursday, May 22 at 11:00 AM at Involta, 3401 Technology Dr, Duluth, MN 55811

Lunch will be provided along with door prizes which include a $50 Best Buy Gift Card!


Click here to RSVP.
 


5th Annual Northland Job Fair

Friday, April 18, 2014