Nucor Corporation announced that it has broken ground on its direct reduced iron (DRI) making facility that will be located in St James Parish, South East Louisiana.

Nucor's Chairman and Chief Executive Officer, Dan DiMicco, spoke at the event on 7 March, alongside Governor Bobby Jindal and Economic Development Secretary Stephen Moret.

The company also announced that Lester Hart has been named the General Manager of the St James Parish facility.

The company received its air permit from the Louisiana Department of Environmental Quality in January after meeting all of the requisite standards ensuring its facility will comply with state and federal environmental controls. Issuance of the air permit allowed the company to begin the process of ordering equipment, and the company will now commence construction.

"We are very excited to be here in St James Parish to break ground on our $750M DRI facility. This facility is an important investment for our company and the state of Louisiana," said DiMicco.

Nucor's commitment to Louisiana has come after a long process of site selection and permitting, negotiations with state and federal lawmakers, as well as local elected officials and community residents.

Initially, Nucor will build one DRI plant of 2.5 million ston annual capacity, but has been permitted for the construction and operation of two plants with a combined annual DRI production of 5.5M stons.

The DRI units will be supplied by a consortium of TenovaHYL and Danieli using their Energiron technology. This produces a high carbide passivated pellet suitable for shipment to Nucor’s EAF sites in the USA.

Nucor has signed a 20 year agreement for supply of natural gas for the plant. In recent years, Louisiana has started to exploit deposits of natural gas in shale in the North West of the State bordering with Texas.

The US Energy Information Administration reports gas reserves of 9307bncf (263.5bnm3) within the state of Louisiana at the close of 2009, up over ten-fold on the 858bncf reported in 2008. In 2010, City Gate (wholesale) prices of NG in Louisiana varied between a monthly high of $6.88 per thousand cubic feet to a low of $4.22.

Ironically, in 2004, Nucor purchased the defunct American Iron Reduction plant in Convent, Louisiana and shipped it to Trinidad where it was upgraded from 1.2Mt/y to 1.6Mt/y by Midrex and restarted production in 2007 under the name Nu-Iron.

It now ships cold DRI back to USA to supply Nucor’s US plants. In 2004, gas prices in Louisiana ranged from $7.87 to $5.21/mcf.