thyssenkrupp Steel has placed an order with SMS group, Düsseldorf, for the engineering, delivery and construction of the first hydrogen-powered direct reduction plant at the Duisburg location. This marks the start of one of the biggest industrial decarbonization projects worldwide, which at one stroke will avoid more than 3.5 million metric tons of CO2 per year in the future. The order volume for SMS amounts to over 1.8 billion euros, and also marks the largest single order in the history of the company. Moreover, significant additional structural building services will be required in addition to infrastructure and media connections. The preliminary tasks can be started immediately, under the scope for an earlier start to work that has been approved. The plant will have a capacity of 2.5 million metric tons of directly reduced iron (DRI), and is scheduled for completion by the end of 2026. The overall project remains subject to European Union approval under state aid provisions, as well as the final funding decision. Both are expected in the coming months. The state of North Rhine-Westphalia and the German government have already signaled substantial financial support for the project.
Replacement of CO2-intensive primary steel manufacture begins
The contract award marks a decisive technological turnaround for Germany’s biggest steelmaker in its more than 200-year history: As part of the tkH2Steel transformation concept, the replacement of CO2-intensive steel production by climate-friendly technologies is now beginning. Up to this point, coal-based hot iron production in the blast furnace always involved emitting large amounts of CO2, amounting to about 20 million metric tons per year from the Duisburg location alone. Hydrogen-based processes in direct reduction plants offer a significant basis for manufacturing carbon-neutral steel in the future. thyssenkrupp Steel is already planning to avoid as much as 6 million metric tons of CO2 by 2030, representing well in excess of 30 percent of its emissions. The transformation to carbon-neutral production should be completed by 2045 at the latest.
Order is awarded to SMS group: a globally active plant builder based in North Rhine-Westphalia
SMS group, a company from North Rhine-Westphalia, has been awarded the contract for the ground-breaking plant at thyssenkrupp Steel. SMS employs a good 14,500 people at around 100 locations. As a specialist for steel industry production plants, it is actively helping shape the transformation of the industry. The order that has now been placed is also historic for SMS: It is the largest single order in the company’s history spanning more than 150 years.
High-tech for carbon-neutral steel production
In pursuit of the best technological solution, thyssenkrupp will be the first steelmaker in the world to combine a 100-percent hydrogen-capable direct reduction plant with innovative melters. Positioning the two melters immediately adjacent to the direct reduction plant allows the solid input stock produced there to be converted into molten iron immediately; this makes the entire process particularly efficient. In addition, the spatial requirements and constraints a complex iron and steel plant involves can be taken into account. The direct reduction plant is based on MIDREX Flex technology. SMS will also deliver the innovative melters, slag granulation and other auxiliary equipment, for example water recycling. SMS is building the plant on an EPC basis. This means the company bears overall responsibility for the engineering, procurement and construction of the plant. In addition, significant further work is required relating to structural and civil engineering, infrastructure and media supply.
The innovative concept ensures consistently high product quality. This is because it is seamlessly integrated into the existing iron and steel plant, thereby allowing all subsequent process steps from the steel mill onward to be maintained. As a result, the existing plant structure can be used efficiently. Customers will continue to receive the complete, high-quality product portfolio with the premium quality they are accustomed to.
Major step toward innovative, industrial climate change mitigation
The cooperation between thyssenkrupp Steel and SMS also sends a strong signal for North Rhine-Westphalia as an industrial center. In building the direct reduction plant, the two companies are forming a partnership for innovation and efficient industrial climate change mitigation. At the present time, thyssenkrupp Steel is still responsible for 2.5 percent of Germany’s CO2 emissions, but the first direct reduction plant alone will save over 3.5 million metric tons of CO2. This corresponds to 20 percent of the company’s current emissions, more or less, and underlines thyssenkrupp Steel’s leading role in the steel industry’s transformation. At the same time, the underlying technological concept can serve as a model for many other decarbonization projects in the industry in Europe and beyond.
Moreover, this step into the transformation will preserve many thousands of high-quality and highly qualified jobs. The innovation alliance between thyssenkrupp Steel and SMS will also call for new qualifications, in addition to the jobs created during the construction of Germany’s biggest direct reduction plant.
The detailed planning and preparatory work for construction of the direct reduction plant will commence immediately, under the scope for an earlier start to work approved by the German government. One of the tasks on the list involves getting the construction site ready on the plant premises of thyssenkrupp Steel.
In parallel to the project, thyssenkrupp Steel will enter into an open and transparent dialog with neighborhood residents, politicians and the general public, to explain the pioneering project that is now being developed to decarbonize steelmaking at the Duisburg site.