I understand that the steel industry will go the DRI route, sooner or later. Primetals works together with Midrex. Has that always been the case, or were there other alternatives under consideration?
There are not that many pathways if you want to achieve carbon neutral steel but one of them is applying direct reduction technology. Starting with natural gas as reductant allows you to gradually or completely switch to green hydrogen, or low-carbon hydrogen whenever it is available at scale. Therefore, this is one of our focus areas. And we have been working quite long with Midrex, it is a successful history of more than 40 years, so it is a quite close and outstanding partnership which we are proud of. Midrex is a shaft-based technology, meaning you feed iron ore pellets from the top, and you discharge the DRI at the bottom. And if required you can make it into HBI for international shipment.
Then tell us about the status of current innovation projects in this field.
The lighthouse R&D project we are following up is HYFOR, which stands for Hydrogen-based Fine Ore Reduction. We have invested quite a large amount of R&D in an industrial pilot plant at voestalpine Donawitz. It is an impressive and massive pilot plant. Together with major mining companies, we have analysed the iron ore market, how it looks like today and what the forecast for the future looks like. All the mining companies are quite worried about their future market. Today their major offtake are the sinter plants and the blast furnaces. Now we see in many reports of consultancies and organisations like Worldsteel and the national energy associations how the landscape will change with respect to technologies. Today we produce 70% of the steel in traditional blast furnaces worldwide. But when we look at 2050, it will only be half the blast furnace capacity that produces hot metal and then steel. So the miners are worried to which offtake they will deliver their iron ore in the future. The technologies change; they are quite interested in investigating how their iron ore is suited for the new technologies. We as a technology provider work very closely with the mining majors. The co-intention was to de-risk the HYFOR technology. We worked at lab scale for quite some years and we are convinced that it is a good technology. But anyhow you have to go through the scaling phases. Now we have the pilot plant up and running. The co-commissioning was in June ’21. Then you have all the little refinements of a new technology; we had to undergo adjustments and optimisation and so on until the beginning of 2022 when it was up and running, and we are fully booked until the end of the year. with investigation of various iron ores from many customers. Recently, we have agreed with leading Austrian steel producer voestalpine, Fortescue, one of the global leaders in the iron ore industry, and Mitsubishi Corporation to jointly investigate an industrial-scale installation for a HYFOR prototype plant and operate it fully based on green hydrogen from an electrolyser plant on the same site. We are very excited about this opportunity and are working intensely together with our partners to finalise the project planning phase later this year.
Customers meaning = the miners?
Not only. If you take for example ArcelorMittal, they have their own mines but are also a steel producer. I cannot disclose who we are working with, who are major players in this field. We are continuously running campaigns with these iron ores, deliver the reports and proofs on how they are performing. There are many topics related to consumption figures, concerns with the iron ore, how the fluidised bed works, and so on. For us, it is important to create a big database for the final stage of upscaling.
Let me ask wide open: Any other criteria on the topic of green steel that we’d need to mention?
Electrification. Many steelmakers intend to implement electric arc furnaces based on a flexible feed mix, depending on the final product grades. Integrated mills are intending to become hybrid mills. They would keep one blast furnace running, blow the other one down and build an EAF that is fed with a flexible mix of scrap, HBI, pig iron ore or hot metal, depending on the quality. And that is one of the roadblocks by the way. It is easy to say, ‘let’s go for an electrification of steelmaking and only remelt scrap.’ But there are two roadblocks: Scrap is not available to the amount required, and the second concern is the quality of the scrap. If you look at voestalpine and others, they go for very high steel grades for automotive applications. These are highly sensitive regarding tramp elements, and you cannot produce them on a 100% scrap basis. You need some virgin feedstock as well. So that is our second pillar where we concentrate a lot on R&D and in an optimisation of the portfolio. The third pillar, to keep it short, is Carbon Capture and Utilisation (CCU). You cannot avoid carbon emissions, especially in India or China, where you have quite new assets of blast furnaces, where the way out is CCU. We are shareholders in Lanzatech, another US-based start-up in the area of bio-fermentation, and collaborates with them in the Steelanol project I mentioned earlier. This plant uses microbes and converts the carbon off-gases, CO and CO2, into chemicals and efuels. The first plant to be commissioned in Europe is ArcelorMittal in Gent. It is a joint partnership of ArcelorMittal, Primetals and Lanzatech first of its kind in Europe, which saw its inauguration at the end of last year. And for carbon capture it is worth mentioning that MHI is by far the market leader in carbon capture technology. They have much experience with CC in power plants and refineries, and Primetals Technologies is now collaborating to apply the same technology, CC, in the steel industry.
So those are the three main pillars to become carbon neutral.
Since this has been a lot about zero carbon and decarbonisation, what I would like to add is that green steel is a much broader concept. It is not only about decarbonisation. It covers all the topics like energy efficiency, technology optimisation. Any type of emission reduction, like particulate matter, NOx, SOx, Dioxines, heavy metals – we cover any emission reduction under this umbrella, but an important pillar is also the circularity. – Recycling of by-products like dust, sludge, slag, synergies with the cement industry – we are working quite a bit in that field. And the last thing is water scarcity. We try to adjust all processes to use as little water as possible. Dry gas cleaning, dry processes really reduce the water consumption per specific tonne of steel produced.
