ArcelorMittal signed Tuesday a memorandum of understanding (MoU) with the Spanish Government that will see a €1 billion investment in decarbonisation technologies at ArcelorMittal Asturias’ plant in Gijón. The investments will reduce CO2 emissions at ArcelorMittal’s Spanish operations by up to 4.8 million tonnes, which represents approximately 50% of emissions, within the next five years.
The MoU states the commitment of ArcelorMittal and the Government of Spain to transition towards a decarbonised steel industry. ArcelorMittal will introduce new manufacturing processes that contribute to a considerable reduction of CO2 emissions. It will also further intensify its R&D capabilities in Spain to support the new project and innovation requirements. The Government of Spain will promote reforms and investments to support the development and growth of a strong, more competitive and sustainable industrial sector, as well as endeavouring to provide maximum financial support for the project, in line with Spanish legislation and European Union regulations.
Given the significant cost associated with the transition, in terms of both capex and opex, it is ArcelorMittal’s expectation this support will cover at least half of the additional cost to enable its operations to remain competitive as it accelerates its decarbonisation program.
The MoU was signed at an event in ArcelorMittal Asturias’ plant in Gijón, which was attended by ArcelorMittal Executive Chairman, Lakshmi Mittal, CEO Aditya Mittal and the President of Spain, Pedro Sánchez as well as Raül Blanco, the Secretary General for Industry, and Adrián Barbón, President of the Asturias regional government.
At the heart of the plan is a 2.3 million-tonne green hydrogen direct reduced iron (DRI) unit, complemented by a 1.1 million-tonne hybrid electric arc furnace (EAF). This starts the transition of the Gijón plant away from the blast furnace-basic oxygen furnace steelmaking production route to the DRI-EAF production route, which carries a significantly lower carbon footprint. The new DRI – which will be the first of its kind in Spain – and EAF will be in production before the end of 2025.
To maximize the emissions reduction potential, ultimately green hydrogen will be used to reduce the iron ore in the DRI, with the EAF powered by renewable electricity. The support of the national and regional governments in this project is crucial as it will enable ArcelorMittal to have access to green hydrogen supplied through a consortium of companies that will cooperate in the construction of the infrastructure required in order to produce hydrogen in the Iberian Peninsula using solar‑powered electrolysis and to transport it directly through a network of pipelines. The initiative involves the construction of multiple large-scale solar farms, with hydrogen produced in situ and with the corresponding impact in terms of employment.
The Gijón DRI will also feed the company’s Sestao plant, situated approximately 250km from Gijón, where production is already entirely from the electric arc furnace route. This means that by 2025 ArcelorMittal Sestao will produce 1.6 million tonnes of steel and be the world’s first full-scale steel plant to achieve zero carbon-emissions.