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LIANE HANSEN, host:

Next stop on our U.P. tour, the iron mines.

(Soundbite of machinery)

HANSEN: It's a 20-mile drive south from Marquette to the vast campus of open pits, dirt roads and imposing pipelines and towers of the Empire and Tilden Mines. They're run by Cliffs Natural Resources. Dale Hemmila is district manager of public affairs and our guide to the massive open pit iron mine.

Mr. DALE HEMMILA (District Manager of Public Affairs, Cliffs Natural Resources): This mine, the Empire that we're at right now is a little bit older mine. It began in 1963, Tilden about 11 years later in 1974.

HANSEN: But this has always been a mining area.

Mr. HEMMILA: Oh, yeah. In fact, this is the second iteration of the Empire mine. There was a smaller Empire Mine, as there was a smaller Tilden Mine. Oh, I would say back 100-plus years ago. Cliffs has been here for 162 years. When you stop and think about it, we're probably one of the longest continuously running companies in the state of Michigan.

HANSEN: The whole state, not just the Upper Peninsula.

Mr. HEMMILA: No, the whole state. I mean, Michigan became a state in 1835, I think, '37, something like that, and we've been here since 1847. For many, many years, we mined what was called the direct shipping ore, which meant it was about 65 percent iron and could be sent directly to a blast furnace to be made into steel.

Back in the late 1940s, it was pretty obvious that that type of ore was going to run out. So, what developed is what we process here now at both Empire and Tilden is taking very low-grade ore that's about 30 to 35 percent, sometimes even less than that, out of the ground and upgrading it to an iron ore pellet that's about 65 percent, which can be used in a blast furnace to make the first step in the steel-making process, which is molten iron.

HANSEN: How many people work here?

Mr. HEMMILA: Roughly about - a payroll of about 1,500. Now, that's a little bit misleading because right now we've got a couple hundred people that are on temporary layoff due to the production issues that we've had related to the economy.

HANSEN: Tell me more about that. How has the economy affected operations here?

Mr. HEMMILA: Essentially, we started the year at roughly about a 50 percent level. We're a little bit more fortunate than our friends in Minnesota - where we also mine iron ore - in that most of the Minnesota mines have had to take some sort of shutdown this year. We have not in Michigan. Even though we've operated at a reduced level, we've still been able to operate throughout the year.

HANSEN: What is the demand for your product?

Mr. HEMMILA: Our end product, for the most part, the steel that's made from the pellets here in Michigan goes into the higher-end steels, the type of steel that's used in appliances, automobiles, those types of things. The biggest issue, obviously, is what we've seen with the auto industry, and there's been much less steel used there because there have been fewer cars being produced.

In addition, because there's been fewer housing starts, there have been fewer appliances purchased. So, for us to, I would say, bounce back to the level we were at in 2007 and early 2008, we need the auto industry to come back to a reasonable level and we need to see new housing developments continue to pick up us well.

HANSEN: How long have you been with the mine?

Mr. HEMMILA: I have a little over 30 years of experience here. I'm a second-generation miner. My father was a miner, worked for these facilities, retired with 35 years at Tilden Mine. I have a brother that works here so - and that's not unusual. It's not unusual at all. If you talk to many of our employees, you'll find that they're second, third and sometimes maybe even fourth generation.

HANSEN: Dale, you're going to take us on a tour.

Mr. HEMMILA: I am.

HANSEN: Get my hardhat and my safety glasses.

Mr. HEMMILA: There you go. Yeah, we'll turn you into a miner.

HANSEN: We buckle up in Cliffs' 16 passenger van and drive to the pit's perimeter. Oh, my.

Mr. HEMMILA: Yeah, people say that a lot.

HANSEN: I would think so. I mean it's like a miniature Grand Canyon over there.

Mr. HEMMILA: People say that, too.

HANSEN: I'm sure they do.

(Soundbite of laughter)

HANSEN: This hole is about half a mile deep and a mile wide and three quarters of a mile across. You can fit a two-floor shopping mall and parking lot here. Way down below, the loaders, shovels, and graders look like Tonka Toys. After the spiraling drive down into the pit, these toys turned into yellow monsters with 12-foot tires and steel-toothed shovels large enough to chew up and swallow Dale's van.

(Soundbite of machinery)

HANSEN: The processing facility is a maze of cages, tanks, graded walkways, and warning signs. Here, the rock is crushed into powder. It's mixed into a pudding, filtered magnetically and chemically and rolled into pellets. They go into a Dante's "Inferno" of kilns to harden, then hit the conveyor belts which dump them on to the mountains of tiny balls near the railroad track.

Mr. HEMMILA: And if you look outside, those are pellets waiting to be shipped. That round building ahead of us you can also stockpile them there and run trains directly underneath there.

HANSEN: Why is this place where we are particularly suited to mining?

Mr. HEMMILA: Well, first of all, it's where Mother Nature put the ore. But the big advantage we have is the transportation, being able to use the Great Lakes, the Soo Locks to get down through the eastern part of the Great Lakes. And then being able also to ship out of the southern part of the Upper Peninsula, which is a straight shot down Lake Michigan to the lower part of Lake Michigan, where the steelmaking plants are located, as well.

HANSEN: And it has always been that way?

Mr. HEMMILA: It has always been that way, yeah.

HANSEN: For 162 years.

A Mr. HEMMILA: Hundred and sixty-two years that we've here, yes. Yeah. We've been in business for a long, long time in Michigan, hopefully for a much, much longer period, as well.

(Soundbite of freighter)

HANSEN: Back on the shore of Lake Superior, just west of Marquette, a freighter named Saginaw is waiting at Cliffs' transportation facility. The dock juts out a quarter mile into the harbor and looks like a rusting hulk of iron the size of an ocean liner. A train is in place on the top. The cars are full of pellets from the Empire and Tilden Mines ready to leave the U.P. One by one, dozens of side shoots open up and pellets tumble into the hold of the shoot.

(Soundbite of pellets)

HANSEN: The steel industry has been under siege. Fewer cars were coming out of Detroit. The auto industry now wants to make them lighter. Demand for the iron mined in the Upper Peninsula had been dropping and miners felt the squeeze. But as Dale Hemmila reminded us, Yoopers are hardy; they adapt and will make it through the hard times.

But there may be a light at the end of this economic tunnel, there are signs that things are picking up again. Cliffs' mining operations is now hiring; 100 new workers are needed.

(Soundbite of piano music)

HANSEN: You're listening to WEEKEND EDITION from NPR News.

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