A Minnesota-based mining company plans to spend as much as $350 million to build a iron ore pellet plant in Indiana, creating up to 100 jobs by 2015, the company announced Tuesday morning.

Magnetation LLC, of Grand Rapids, Minn., said it would break ground on the plant in Reynolds in the first quarter of 2013. Reynolds is about 25 miles north of Lafayette.

When it becomes operational in 2015, the plant will produce iron ore pellets, a critical raw material in the steelmaking process, for use by AK Steel Corp. Magnetation will transport iron ore concentrate via rail from its operations in northern Minnesota to Reynolds.

"With convenient access to major railways and highways, Reynolds is an outstanding location for the company's new pellet plant," Magnetation CEO  Larry Lehtinen said in a prepared statement.

The Indiana Economic Development Corp. offered MagPellet LLC, a Magnetation subsidiary, up to $1.5 million in conditional tax credits and up to $200,000 in training grants based on the company's job-creation plans.

The Indiana Department of Transportation also will assist the project by improving rail service to the site. White County is offering additional financial support using revenue from a tax increment financing bond.

Utility NIPSCO said it will provide the company $23 million in additional energy and infrastructure incentives.

The Magnetation plant will use a site that was graded and prepared for a high-profile ethanol refinery project late last decade, but was never completed after VeraSun Energy Corp. went bankrupt.

"This announcement is a huge shot in the arm for the local economy in Reynolds and White County," said John Heimlich, president of the White County commissioners, in a prepared statement.