Year-old Prairie River Minerals will build a multimillion-dollar ore-processing plant near Coleraine, Minn., on the site of a rail facility once owned by Magnetation.

The Iron Range project will be at Magnetation's Jessie Loadout Facility. Prairie River Minerals (PRM) — whose original partners included former Minnesota legislator Tom Anzelc — was the approved buyer in June of the facility out of bankruptcy court.

Anzelc is now a consultant to the group.

Construction starts this month and is expected to wrap up in the fall. Called a demonstration plant, the facility will process leftover iron ore waste-tailings so they can be used by steel plants.

"We'll bring good paying union jobs to this region, be environmentally friendly, and benefit our local communities and the state of Minnesota," Larry Sutherland, PRM's new CEO and former general manager of U.S. Steel ore operations in Minnesota, said in a statement.

Some of the ore that PRM will process comes from the early days of ore mining in Minnesota, he said. South African engineer and metallurgist Johann Grobler will serve as technical director.

Grobler and Anzelc are among several partners who formed PRM in January 2019. Six months later, the team paid $1.95 million to buy select Magnetation assets in Coleraine and Keewatin out of bankruptcy. The Magnetation loading equipment and other assets PRM bought will help PRM with its new demonstration plant in Coleraine, the company said.

Sutherland declined to talk specifics on the cost of the plant, but said the costs of the assets plus construction make it a multimillion-dollar project.

The PRM group will use an "ultrahigh dense medium separation technology" developed by Grobler to extract ore from the 1930s-era waste-rock stockpiles that were never fully processed on the Iron Range. Magnetation once had facilities in Grand Rapids, Coleraine, Bovey, and Keewatin, as well as in Indiana, before it filed for bankruptcy in May 2015.

The entity was bought out of bankruptcy by ERP Iron Ore, led by Virginia health care businessman Tom Clarke. But Clarke, who also failed to jump-start the former Essar project, soon ran into trouble with his plans to bring his Magnetation/ERP vision to life.

ERP said its efforts with the former Magnetation properties failed to materialize due to higher pollution-control costs and lower ore prices than Clarke had calculated.

ERP in turn filed for bankruptcy in mid-2018.