Nucor responds to Zen-Noh lawsuit

Steelmaker Nucor Corp. said Monday a federal court in New Orleans should not halt construction of its new iron plant in St. James Parish unless pending state court challenges or environmental regulators first stay or overturn the facility’s air permits.

Neighboring grain elevator Zen-Noh Grain Corp. filed suit in April in U.S. District Court to stop construction of the direct reduced iron plant near Rome-ville until the permits it’s challenging are properly issued.

Zen-Noh is concerned about air quality impacts on the purity of its grain.

Construction on Nucor’s $750 million DRI plant began last year at its 4,000-acre site along the Mississippi River. The natural gas-fired plant will prepare iron ore pellets for steelmaking.

The DRI plant is the first of possibly five phases for a steel complex Nucor is planning over several years worth $3.4 billion.

Nucor, of Charlotte, N.C., filed the response Monday and contends that the plant work is occurring under proper air permits.

The response says that Zen-Noh has two pending state court suits against the Louisiana Department of Environmental Quality over permits related to the Nucor facility, among other court challenges and administrative appeals with DEQ and the U.S. Environmental Protection Agency.

“Defendants contend that unless and until the permits are revoked or modified by LDEQ or EPA or there has been a finding on the merits by the 19th Judicial District Court or a Louisiana appellate court that CEM is constructing the DRI facility without a permit, the court does not have the power to enjoin the construction,” Nucor’s response says.

CEM stands for Consolidated Environmental Management Inc., a company affiliated with Nucor named in Nucor air permits.

At issue in the lawsuit is a switch in iron reduction technology that Nucor made after the initial air permits were issued in January 2011.

Nucor switched from the process supplied by one company, Midrex, to another, Tenova HYL.

The lawsuit centers around whether the switch is a minor or major change and which of two air permits should have been modified: the pre-construction permit or the operational permit for the DRI plant.

Zen-Noh says the pre-construction permit, called a prevention of significant deterioration permit, should have been changed, requiring new air emissions models and more public comment.

Nucor asked DEQ to modify its Part 70 operational permit last year instead to reflect the changes and did not submit new models.

In court papers filed last month, Zen-Noh noted DEQ responded to public comments on the initial air permits that they were only for the Midrex design and do not allow Nucor to use the kind of process that Zen-Noh says Tenova uses.

“The permit is not for this process, and it was not done appropriately, and that is the nuts and bolts of the federal court suit,” Zen-Noh attorney Paul Vance said Monday.

Sam Phillips, DEQ Office of Environmental Services assistant secretary, said the initial permits were for Midrex’s technology, but DEQ determined the PSD permit did not need modification to make the switch.

He said there was no reason to redo the air emission models because the Tenova’s HYL process reduces air emissions.

“They (Zen-Noh Grain) are absolutely grasping at straws that aren’t there,” he said.

A telephone status conference is set for 10 a.m. June 14 with Judge Sarah Vance.