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SMS Group awarded contract for thyssenkrupp Steel’s hydrogen-powered direct-reduction plant in Duisburg

| By Mary Bailey

thyssenkrupp Steel has placed an order with SMS group (Düsseldorf, Germany) 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 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.

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.

thyssenkrupp will be the first steelmaker in the world to combine a 100-percent hydrogen-capable direct reduction plant with innovative smelters. Positioning the two smelters 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. In addition, significant further work is required relating to structural and civil engineering, infrastructure and media supply.

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.