MIDREX® Direct Reduction Plants – 2015 Operations Summary

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Antonio ElliotManager – Technical Services

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MIDREX® Direct Reduction Plants - 2015 Operations Summary

MIDREX® Plants produced 45.75 million tons in 2015, 3.0% less than in 2014.

The production for 2015 is estimated from the 31.2 million tons confirmed by MIDREX® Plants located outside of Iran and the 14.55 million tons located within Iran reported by the World Steel Association, all by plants based on MIDREX® Direct Reduction Technology.

MIDREX® Plants continued to account for approximately 80% of worldwide production of natural gas-based direct reduced iron (DRI) by shaft furnaces. Despite exports of steel from China, which caused steel production in many locations worldwide to slow, at least 11 MIDREX® Plants established new annual production records and at least 10 plants established new monthly production records. Four additional MIDREX® Modules came within 10% of their record annual production, and at least 7 MIDREX® Modules operated in excess of 8,000 hours. Production of DRI/HBI slowed at many plants towards year end (there was a 20% drop in total production from plants outside Iran in the 4th quarter compared to the first three quarters of the year).

Throughout 2015, iron ore prices declined as Chinese ironmaking growth slowed while Australian and Brazilian ore supply simultaneously grew. By December, the price for 62% Fe fines to northeast China had fallen to one-fifth of the price it commanded at the peak in early 2011.

One new MIDREX® Module started up in 2015: ESISCO (Egyptian Sponge Iron Steel Co.), a cold/hot DRI MIDREX® Plant belonging to Beshay Steel in Sadat City, Egypt.

Cumulative production of DRI products (Cold DRI, CDRI; Hot DRI, HDRI and Hot Briquetted Iron, HBI) by MIDREX® Plants has exceeded 875 million tons through the end of 2015.

2015 PLANT HIGHLIGHTS

ACINDAR

After breaking annual production records in 2013 and 2014, ACINDAR’s MIDREX® Plant started off the year at somewhat reduced capacity but ended the year at maximum capacity after the typical winter natural gas curtailments. The plant averaged more than 131 tons per hour (t/h) for the year. In 37 years of operation, ACINDAR’s MIDREX® Plant has produced 28.5 million tons, the most by a single MIDREX® Module to date.

ANTARA STEEL MILLS

The first MIDREX® Plant designed to make HBI produced under annual rated capacity in 2015 due to market constraints.

ARCELORMITTAL HAMBURG

AM Hamburg’s MIDREX® Plant, the oldest in operation, which originally started operation in 1971, comfortably exceeded annual rated capacity in 2015, averaging 80 t/h. This was an hourly capacity record for the plant and the plant came within 10% of its record annual production.

ARCELORMITTAL LAZARO CARDENAS

AMLC operated 18% over its rated annual capacity of 1.2 million tons. In 2015, AMLC surpassed the 27.7 million ton production milestone, achieved in 18.5 years since its start-up in August 1997. Production rate averaged more than 188 t/h for the year.

ARCELORMITTAL MONTREAL

After setting annual production records for two consecutive years in 2013 and 2014, Module II’s 2015 production was only 0.12% short of its 2014 record production. Module I’s 2015 production was well over rated capacity and 12% less than its record annual production. Module II produced over 100,000 tons in July, handily exceeding its previous monthly production record, while Module I fell short of its monthly production record by only 0.4%. Both modules have been operating at full capacity due to competitively priced natural gas and oxide pellets sourced locally.

ARCELORMITTAL SOUTH AFRICA (SALDANHA WORKS)

Operation of the COREX® export gas-based MXCOL® Plant was limited by the availability of gas from the COREX® Plant. The plant averaged using more than 68% South African lump ore for the year.

ARCELORMITTAL POINT LISAS

All three of AMPL’s MIDREX® Modules operated for most of 2015, producing almost 1.0 million tons of DRI for the adjacent steel shop and for overseas export. Thirty five years after the start-up of Module 1, all three modules were idled in October 2015, having produced over 42 million tons.

COMSIGUA

COMSIGUA operated at reduced capacity three partial months in the year due to the limited supply of locally produced pellets.

DELTA STEEL

The two Delta Steel MIDREX® Modules did not operate in 2015.

DRIC

DRIC’s two MIDREX® Modules in Dammam, Saudi Arabia, kept production steady to satisfy the demand of their neighboring Al-Tuwairqi steel shops. Module 1 set a new annual production record for the sixth consecutive year and both modules set new monthly production records. Module 1 has averaged 8,030 hours of operation per year over the last 4 years.

ESISCO

Due to the high price and reduced availability of natural gas in Egypt during 2015, ESISCO operated intermittently throughout its first year of existence.

ESSAR STEEL

The two largest of Essar Steel’s six MIDREX® Modules operated at reduced production rates due to a shortage of iron ore and very high natural gas prices in India. Essar was able to use off-gas from its COREX® Plant in its MIDREX® Modules. The four smaller modules remained shut down for the whole year, while Module 5 operated five partial months and Module 6 operated the whole year.

EZDK

Limited by natural gas availability in Egypt, the three EZDK MIDREX® Modules produced just over 1.5 million tons in 2015, about 50% of their maximum capacity. Fifteen years since initial start-up, EZDK’s Mod 3, rated for 800,000 t/y, has produced 14 million tons through the end of 2015 despite the slowdown the last couple of years due to the limited availability of natural gas. The three modules have produced 54 million tons of DRI to date.

FERROMINERA ORINOCO

In its 25th anniversary year, Ferrominera Orinoco’s MIDREX® HBI Plant in Puerto Ordaz, Venezuela, operated at reduced capacity during the entire year; however, it still accounted for over 70% of the 677,000 tons of HBI produced by MIDREX® Plants in Venezuela in 2015.

HADEED

Hadeed exceeded rated capacity for the 31st consecutive year in Modules A and B and for the 23rd consecutive year in Module C. Modules A and B each surpassed the 20 million tons milestone in 2015, and the flue gas exhaust systems in both modules were upgraded as part of Hadeed’s program to reduce energy consumption. Hadeed’s Module E set new monthly production records in April and May, reaching 250 t/h monthly average in April. Hadeed’s four MIDREX® Modules have produced more than 78 million tons of DRI to date.

JINDAL SHADEED

Jindal Shadeed set a new annual production record in 2015, 0.6% higher than their previous record set in 2013, despite being limited by the availability of natural gas. The plant operated 8,184 hours in 2015. The MIDREX® Plant is designed to produce mainly HDRI with HBI as a secondary product stream. A major portion of the production was consumed by Jindal Shadeed’s own steel shop.

JSPL (ANGUL)

Jindal Steel and Power Ltd.’s (JSPL) combination HDRI and CDRI plant in Angul, Odisha State, India, set new annual and monthly production records last year. This is the first MXCOL® DRI plant using synthesis gas from coal gasifiers to produce HDRI and CDRI for the adjacent steel shop. Operation began in 2014 and the plant continued ramping up production in 2015 with more than 70% of the production supplied hot to the steel shop.

JSW STEEL (DOLVI)

JSW Steel comfortably exceeded rated capacity in 2015. A new system installed at the end of 2014 to reduce natural gas consumption by adding Coke Oven Gas (COG) coming from JSW Steel’s coke oven batteries on site to the MIDREX® Shaft Furnace operated throughout the year. At the end of the year the plant was shut down temporarily for major maintenance.

JSW STEEL (TORANAGALLU)

JSW Steel’s new cold/hot DRI plant using COREX® export gas in Toranagallu, India, finalized commissioning and was started up in August 2014, setting a new annual production record in 2015. The plant is designed to produce 1.2 million tons per year of HDRI and CDRI. This is the second plant of its kind; the first one being the COREX®/MIDREX® Plant at Saldanha, South Africa.

LEBEDINSKY GOK

LGOK’s MIDREX® HBI Module set a new annual production record of 1,641,000 tons in 2015, 17% over their rated capacity of 1.4 million tons, thanks to record-breaking average hourly production of almost 199 t/h and 8254 hours of operation.

LION DRI

The production of the Lion DRI plant located near Kuala Lumpur, Malaysia, continued to be reduced and intermittent due to reduced steel shop demand. Production in 2015 consisted of 85 percent HDRI and 15 percent HBI.

LISCO

The three MIDREX® Modules in Misurata, Libya were severely restricted by natural gas supply in 2015. Module 2 has produced over 10 million tons since its start-up 25 years ago.

NU-IRON

In 2015, Nucor’s MIDREX® Plant in Trinidad established a new annual production record for a second year in succession due to increased operational availability, and set a new monthly production record in March. Average DRI metallization for the year was the highest of all MIDREX® Plants at 96.31 percent, with 2.71 percent carbon in the DRI produced.

OEMK

OEMK again produced over 2.8 million tons in 2015, with Modules 1, 2 and 3 setting new annual production records. Modules 1, 3 and 4 also broke their previous monthly production records, with Module 4 breaking it three times at the end of the year after a major maintenance shutdown. The operating hours for OEMK’s modules 1, 2 and 3 averaged an exceptional 8453 hours in the year. Module 2 surpassed its 15 million ton milestone in its 30th anniversary year.

QATAR STEEL

In its eighth full year of operation, Qatar Steel’s dual product (CDRI and HBI) Module 2 set a new annual production record for the fifth consecutive year, 6.9% above its previous record, due to exceptional plant availability (8487 hours of operation). This MIDREX® Module operated 25.8 percent over its rated annual capacity of 1.5 million t/y, totaling 1,887,000 tons for the year, a new record for MIDREX Modules with 6.5 meter nominal diameter Shaft Furnaces. Almost the entire production from Module 2 was CDRI with metallization averaging 94.8 percent for the year. The production of Module 1 was only 5.6% below its record annual production, and the Module operated 8181 hours.

SIDOR

Production from all four of Sidor’s MIDREX® Modules was 1.35 million tons in 2015, limited by a lack of oxide pellets. Module 2C remained shut down the whole year.

SULB

SULB’s 1.5 million tons/year combo MIDREX® Plant (simultaneous CDRI and HDRI production) in Bahrain was limited by market demand in its second full year of operation. Hot DRI accounted for 68% of production and approximately 75% of the CDRI produced was shipped to third parties by sea.

TENARISSIDERCA

TenarisSiderca operated below maximum capacity throughout 2015 due to limited DRI demand by the steel shop and natural gas curtailments during the winter months. CDRI metallization averaged 95.77 percent for the year. This module surpassed its 20 million ton milestone in December 2015. It has been in operation since October 1976.

TUWAIRQI STEEL MILLS

The Tuwairqi Steel Mills 1.28 million tons/year MIDREX® Plant located near Karachi, Pakistan, did not operate in 2015 due to market conditions.

VENPRECAR

In its 25th anniversary year, VENPRECAR’s HBI production was severely restricted by the limited availability of iron ore pellets in Venezuela, operating only four partial months in the year.