The voestalpine Group has announced completion of its $740 million direct reduction plant in Corpus Christi, TX. Each year the plant will produce two million tonnes of HBI (hot briquetted iron, or sponge iron), a sophisticated pre-material used in steel production.
The new plant covers an area of two square kilometers. The plant's own deep-sea port can currently handle five million tonnes of material each year (3 million tonnes of iron ore pellets and 2 million tonnes of HBI). The 137-meter-high reduction tower forms the heart of the plant. voestalpine Texas LLC is creating 190 new jobs at the plant, and will generate around $600 million over the coming decade.
In contrast to pure coke- and coal-based blast furnaces, the plant in Corpus Christi uses only comparatively environmentally friendly natural gas as the reducing agent. Across the Group, using the HBI produced in Texas in voestalpine blast furnaces and steel plants will lead to a reduction in carbon dioxide emissions of around 5% percent. At the same time, the new plant opens up further technological possibilities for the future.
"We are systematically working to gradually decarbonize steel production, first by the partial substitution of coal and coke with gas-based bridging technologies, and then by the long-term, gradual use of carbon dioxide-neutral hydrogen," said Wolfgang Eder, Chairman of the Management Board of voestalpine AG. "With adequate availability, in the future `green' hydrogen could also replace natural gas as a reducing gas in Texas, making possible the emission-free production of HBI."
In order to gain the necessary experience, a pilot facility worth about $23 million will soon be installed at the voestalpine site in Linz, Austria. It will use electrolysis to produce hydrogen. "End-to-end hydrogen-based steel production could become a reality in around 20 years and is dependent on energy being available at reasonable costs," said a company spokesperson.
A politically stable and predictable environment, professional cooperation with the authorities, cost-efficient energy supply and logistical advantages were the key reasons behind the decision to locate the plant in Corpus Christi. "As an investor, during each phase of the project we were able to notice the intense efforts being made to reindustrialize in the USA. The USA has recognized that a sustainable industrial manufacturing base is essential to a country's stable economic development over the long term," said Eder. "Compared to the USA, Austria and Europe will doubtless remain an expensive location in the long run, particularly in terms of energy supply: average industrial gas prices in Austria over the longer term are around three times as high, and electricity prices around twice as high as those in the USA. The annual costs of operating an identical direct reduction plant in Austria would be around $225 million higher than in Texas, purely due to the price differences for gas, electricity and logistics. In Europe, however, increasing political and social detachment from anything to do with industry is at least equally problematic."
For more information contact:
voestalpine Texas LLC
2800 Kay Bailey Hutchison Road
Portland, TX 78374
361-704-9000
office.texas@voestalpine.com
www.voestalpine.com/texas