ArcelorMittal plans major EAF, DRI investments for decarbonizing steel production in Canada
31 July 2021
ArcelorMittal announced with the Government of Canada its intention for a CAD 1.765-billion (US$1.4-billion) investment in decarbonization technologies at ArcelorMittal Dofasco’s plant in Hamilton.
At the heart of the plan is a 2 million tonne capacity Reduced Iron (DRI) facility and an Electric Arc Furnace (EAF) facility capable of producing 2.4 million tonnes of high-quality steel through its existing secondary metallurgy and secondary casting facilities.
Innovative DRI. Source: ArcelorMittal
Modification of the existing EAF facility and continuous casters will also be undertaken to align productivity, quality and energy capabilities between all assets in the new footprint.
The intended investments will reduce annual CO2 emissions at ArcelorMittal’s Hamilton, Ontario operations by approximately 3 million tonnes—approximately 60% of emissions—within the next seven years.
ArcelorMittal will introduce new manufacturing processes that contribute to a considerable reduction of CO2 emissions and deliver other positive environmental impacts including the elimination of emissions and flaring from coke-making and ironmaking operations.
Smart Carbon. Source: ArcelorMittal
The investment is contingent on support from the governments of Canada and Ontario. The Government of Canada announced it will invest CAD 400 million (US$321 million) in the project. The company is in discussions with the Government of Ontario regarding its support.
The new DRI and EAF will be in production before the end of 2028.
This project is part of ArcelorMittal’s new global 25% CO2 2030 emissions reduction target which was announced yesterday in our second climate action report. DRI-EAF technology, such as that being introduced in Dofasco, is at the heart of our new target although we do also continue to develop our smart carbon technology route. Transitioning from the blast furnace route to the DRI-route offers an immediate significant reduction in emissions in the first phase through natural gas and then in a second phase, which we call innovative DRI, harnessing green hydrogen or other Smart Carbon technologies.
This is the first significant decarbonization project we have announced outside Europe and again reflects ArcelorMittal’s determination to lead the decarbonization of the steel industry. Across the company our people are highly motivated to demonstrate that steel can reach net zero and will be the core material for a carbon-neutral world. This project in Dofasco is a very significant and important milestone in this journey.—Aditya Mittal, CEO ArcelorMittal
ArcelorMittal has an ambition to be net-zero by 2050. The company recently published its second group Climate Action Report in which it set a new 2030 global carbon emissions intensity reduction target of 25%. It has also increased its European 2030 carbon emissions intensity target to 35%, from 30%.
ArcelorMittal estimates the cost of achieving its global 2030 carbon reduction target is around US$10 billion and believes government funding support of approximately 50% is required to enable the company to remain competitive regionally and globally through the transition period given the capital investment required and higher operating costs of low-carbon steelmaking technologies.
The company expects to deploy approximately 35% of this $10-billion investment by 2025 with the remainder in the second part of this decade.
The Company has developed two technology pathways, Smart Carbon and Innovative DRI, both of which it believes will have an important role to play in helping the company achieve net zero by 2050.