Long before the war, Metinvest, mining and metallurgical group of companies, developed a strategy for the transition to green steel production, said Dmytro Nikolayenko, Chief Commercial Officer (CCO) of the Group, during the Ukraine Recovery Conference in Berlin.
"We at Metinvest developed a strategy for the transition to green steel long before the war with the support of McKinsey. It provided for the transition of blast furnaces to DRI at our steel mills," he said.
At the same time, Mr Nikolayenko noted that there were two biggest problems in the transformation of green steel in the world. The first was the availability of "green" energy, the second was the availability of a source of virgin iron, produced in an environmentally friendly way with the lowest possible carbon emissions.
"In both of these tasks, Ukraine can be a very good partner in the European context of this transformation, because we have a very good source of iron ore, which can be very well enriched – up to 70% or more of Fe, and this is quite possible for the production of DRI class pellets (direct reduction iron pellets DRI - IF-U)," COO stated.
According to Mr. Nikolayenko, before the war, Metinvest produced 44 million tonnes of various types of iron ore products, of which 2 million tonnes were DRI pellets.
"And we have projects for the transformation and reconstruction of our facilities at Northern Iron Ore. There is a project to enrich our concentrate, in particular by the flotation method, and the construction of two pelletizing machines for the production of DRI pellets with a capacity of up to 12 million tonnes per year. The project can also be implemented at Southern Iron Ore (JV), which will be able to produce a total of about 20 million tonnes of DRI pellets," said CCO.
He added that these two major projects will require investments of $2.6 billion, which can be implemented in stages.
In addition, a project to build three production facilities with a capacity of up to 5.6 million tonnes of DRI-HBI (environmentally friendly direct reduction iron briquettes), which will also require about $2 billion in investment. There are customers for such products not only in Europe, but also in Ukraine, Mr Nikolayenko emphasized.
According to the top manager, Metinvest is ready for a "green" agenda in terms of implementing these projects, but the biggest issue is funding and guarantees, which are difficult to obtain in the current circumstances of Ukraine. He clarified that these projects were long-term, their implementation would take more than five years, and the largest part of this time will be taken by the preparation and design phase - more than one year.
"We at Metinvest are quite ready to participate in the transformation of Europe into green steel with a specific and very well-developed project at the moment," Nikolayenko summed up.
The material was prepared by Interfax-Ukraine.
