Swedish trio signs EU grant for fossil-free steel

A Swedish team made up of utility Vattenfall AB, steel company SSAB AB (STO:SSAB-A) and miner Luossavaara-Kiirunavaara AB (LKAB) has officially been awarded EUR 143 million (USD 158m) by the EU to demonstrate a full value chain for hydrogen-based iron and steel production.

The HYBRIT demonstration project, which will cover activities from mining to steelmaking, involves 500 MW electrolysis. It is one of seven projects that were selected for a total of EUR 1.1 billion in grant funding from the EU Innovation Fund as part of its first call for large-scale projects. The project's grant agreement was signed in Stockholm on Friday.

The initiative will replace coal-based blast furnaces with direct hydrogen-based reduction technology. A new facility will be set up in Gallivare for hydrogen-based direct reduction with 500 MW electrolysis. In addition, SSAB will replace its blast furnaces by an electric furnace in Oxelosund to demonstrate electric melting of hydrogen-based direct reduced iron. LKAB will also demonstrate fossil-free DR-pellets production for the hydrogen reduction process.

The project will produce about 1.35 million tonnes hydrogen reduced iron a year, to go for crude steel production representing about 25% of Sweden's total production.

“With the upcoming plant in Gallivare, we will establish a first-of-a-kind facility and process for producing fossil-free sponge iron in industrial scale. This will demonstrate the true potential of the HYBRIT technology and pave the way for competitive production of fossil-free steel and a sustainable future,” said Lars Ydreskog, LKAB senior vice president strategic projects.

(EUR 1 = USD 1.105)

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