P2G TECHNOLOGIES IN IRON ORE PELLETIZING PROCESS. Mariana Carvalho, LUT Esa Vakkilainen, LUT

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1 P2G TECHNOLOGIES IN IRON ORE PELLETIZING PROCESS Mariana Carvalho, LUT Esa Vakkilainen, LUT WP3 WORKSHOP

2 Iron and steel sector is the major industrial CO 2 source Rationale Fines are significant in mining stage (at least 50%), ~70% of global iron ore demand 1 Uniform ores increase energy efficiency à agglomeration processes Source: IEA/OECD Energy Technology Transitions for Industry. Available at ns/publication/industry2009.pdf 1 CRU Group Available at:

3 Markets Global iron ore production: 3220 Mt in ~20% of the global market for pellets 2 Varies from country e.g. in Brazil ~90% of the production are ore fines, from which 70% sinter feed and the remaining 30% pellet feed 3 Who and where Top three countries: China, Australia and Brazil Top three companies: Vale, Rio Tinto and BHP Billiton Future outlook: growth follows steel production, expected to grow 1.5 times by USGS Iron ore statistics and information. Available at: 2 Poveromo, JJ Raw Materials & Ironmaking Global Consulting. Available at: 3 DNPM Sumário Mineral. Available at: 4 World Steel Association World Steel in Figures. Available at /document/World%20Steel%20in%20Figures% pdf

4 Technical Implementation Traveling grate pelletizing process Flame temperature is the main parameter Estimated emissions ~55 Mt CO 2 /year globally Hydrogen from AEC to substitute NG

5 Sintering process Technical Implementation Estimated emissions >200 Mt CO 2 /year globally à ~3% of Iron & Steel industry

6 General Assumptions Break even electricity price was calculated as function of operating time for different scenarios FCR markets not considered Profit from heat not considered

7 General Assumptions Plant production 5 Mt/year, 8000 h/year Fixed specific energy consumption: Pelletizing: 1.12 GJ/t pellet, 42% NG and 58% solid (coal + coke breeze) Sintering: 1.5 GJ/t sinter, 10% gas and 90% solid Air from cooling process ~50 Nm 3 /s per t pellet at 1000 ºC Electrolyser efficiency (LHV) 65% at 70 ºC Required hydrogen was calculated in order to maintain flame temperature as for the original fuels

8 Material and Energy Balances: Pelletizing Kiln NG AR 4,90 Mass Balance Temperature CO 2 Emissions Phase kg/s kmol/s Nm3/s Nm3/min [K] 78,08 kg/gj fuel Air 321,2 11,20 250, ,18 kg/s CH 4 1,693 0,094 2, ,45 kg/t Solid 3,851 0, t/year Flue gas 326,7 11,36 252, TOTAL IN , oc 194,44 MW Hydrogen Phase Mass Balance AR 5,18 Temperature CO 2 Emissions kg/s kmol/s Nm3/s Nm3/min Vol. Diff. [%] [K] 54,65 kg/gj fuel Air 321,2 11,20 250, ,00 % ,63 kg/s H 2 0,700 0,35 7, % ,21 kg/t Solid 3,851 0, t/year -30,0 % Flue gas 325,7 11,43 253, ,37 % TOTAL IN , ,26 % 1441 oc Electricity demand 196,79 MW 1,2 % 129 MW Gas consumption 84,0 MW 2,8 % 1028 GWh/year

9 Material and Energy Balances: Sintering Kiln RESULTS SUMMARY NG AR 5.15 Mass Balance Temperature CO 2 Emissions Phase kg/s kmol/s Nm3/s Nm3/min [K] kg/gj fuel Air kg/s CH kg/t Solid t/year Flue gas TOTAL IN oc MW Hydrogen Phase Mass Balance AR 5.21 Temperature CO 2 Emissions kg/s kmol/s Nm3/s Nm3/min Vol. Diff. [%] [K] kg/gj fuel Air % kg/s H % kg/t Solid t/year -6.2 % Flue gas % TOTAL IN % 1427 oc Electricity demand MW 0.3 % 41 MW Gas consumption 26.8 MW 2.7 % 327 GWh/year

10 CAPEX, OPEX and Incomes 20 years lifetime Total O&M 2.4%, water 0.4 /m 3 Different scenarios were considered varying: WACC: 8 12% Electrolyzer investment cost: /kwe Oxygen selling price: 0, /t Natural gas purchase price: /MWh CO 2 : 0 10 /t

11 Profitability 1/3 Investment Cost Oxygen Price Electricity price /MWh Electrolyser operating hours [h/year] Electricity price /MWh Electrolyser operating hours [h/year] IC -20% Base IC +20% IC +50% O2 70 Base O2 20 O2 0 Natural Gas Electricity price /MWh Base Case: IC = /KWe O 2 = 50 /t NG = 40 /MWh WACC = 10% a CO 2 = 5 /t Electrolyser operating hours [h/year] NG 50 Base NG 35

12 Profitability 2/3 CO2 WACC Electricity price /MWh Electricity price /MWh Electrolyser operating hours [h/year] Electrolyser operating hours [h/year] CO2 10 Base CO2 0 WACC 8% Base WACC 12% Base Case: IC = /KWe O 2 = 50 /t NG = 40 /MWh WACC = 10% a CO 2 = 5 /t CO2 and WACC does not seem to have much impact

13 Profitability 3/3 Scenarios Electricity price /MWh Electrolyser operating hours [h/year] Optimistic Base Pessimistic 2010 Prices Cumulative average price Optimistic: IC = /KWe O 2 = 70 /t NG = 50 /MWh WACC = 8% a CO 2 = 10 /t Base Case: IC = /KWe O 2 = 50 /t NG = 40 /MWh WACC = 10% a CO 2 = 5 /t Pessimistic: IC = /KWe O 2 = 0 /t NG = 35 /MWh WACC = 12% a CO 2 = 0 /t

14 Environmental Effects 30% CO 2 emission reduction expected for pellet kilns But only 6% expected for sintering Evaluate possibility to increase gas share in sintering kilns

15 Summary and Conclusions Agglomeration process are relevant for the Iron & Steel industry Use of hydrogen can be feasible: Investment costs is the main parameter Followed by electricity price NG price also play a important role Expected large CO 2 emission reduction

16 WP3: NCE REPORTING

17 Rationale: Content: P2G technologies in iron ore pelletizing (Mariana Carvalho) Iron ore agglomeration process are relevant for the Iron & Steel sector Pelletizing uses natural gas and solid fossil fuels (e.g. coal and coke breeze) NG could be replaced by hydrogen Material and energy balances were developed, based on a fixed flame temperature Break even electricity price was calculated as function of operating time for different scenarios Variations in the investment costs, oxygen selling price and NG purchase price were considered Schedule, reporting, deliverables: Report or conference paper by March 2016 Deeper analysis? Sintering case? Co-operation aspects: UFMG Brazil Mining companies (Vale, Samarco) have been contacted