Joel Morales Marketing Manager/TENOVA HYL Dubai, UAE. Economics with High-Carbon DRI from ENERGIRON DR Technology

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1 Joel Morales Marketing Manager/TENOVA HYL Dubai, UAE Economics with High-Carbon DRI from ENERGIRON DR Technology

2 DRI MARKET SCENARIO

3 Raw materials & metallics current scenario EVOLUTION OF THE RAW MATERIALS COSTS* The raw materials market is facing significant prices decrease, mainly caused by: * Source: Siderweb Iron ore Scrap Coal global economic slowdown, especially in emerging countries, deceleration of the steel production growth, especially China (50% of world production), over supply of some raw materials, particularly iron ore. however, iron ore pellets for DRI grade with complicated supply and still comparatively high price

4 DRI current market scenario DRI production under difficult conditions but still feasible for some regions and local conditions DRI cost

5 DRI market scenario POSITIVE EFFECTS OF THE DR ROUTE DRI production positive effects: Less dependence of scrap & pig iron pricing. Keeping/expanding the production of quality steels. Less dependence on foreign manufacturers, often located in politically unstable areas of the world. Any profits and commitments for targeting decrease of CO 2 emissions

6 ENERGIRON ZR PROCESS

7 ENERGIRON ZR PROCESS: DRI Quality & Efficiency High Temp: >1050 C High Pressure: 6-8 bar CO 2 (+H 2 S) NG, Syngas, COG fuel H 2 O O 2 Iron Ore Simultaneous: - in-situ CH 4 reforming - Reduction - Carburisation DRI QUALITY: > 94% Mtz; 2%-4.5% Carbon (as Fe 3 C) OPEX: Highest overall Energy efficiency Overall optimization: ~ 9.5 GJ/t; High operating pressure: < 80 kwh/t High yield: <1.4 t IO/t (1) Hot DRI & Cold High-Carbon DRI HBI

8 FLEXIBILITY: Same scheme for ANY energy source ENERGIRON ZR PROCESS: FLEXIBILITY ENVIRONMENTAL: lowest NOx emissions: kg NOx/tDRI selective removal of iron ore reduction s byproducts: H 2 O & CO 2 : CO 2 as by-product CO 2 removal H 2 O Iron Ore From Total Carbon input: CO 2 (+H 2 S) NG, Syngas, COG fuel O 2 Flexible, reliable and safe Transport system of DRI to EAF s 62% as SELECTIVE CO 2 Approx. 256 kgco 2 / t DRI can be sequestrated and/or sold as by-product Hot DRI & Cold High-Carbon DRI HBI

9 HIGH CARBON FROM ENERGIRON ZR

10 HIGH-CARBON DRI: a unique product from ENERGIRON-ZR Process conditions favors the Iron carbide formation Iron Ore T > 1050 C P ~ 6-8 bar CH 4 > 20% H 2 /CO ~5 Carburization 3Fe + CH 4 Fe 3 C + 2H 2 In-situ Reforming Reduction / Carburization HIGH-CARBON DRI: DRI with 3.5%C, with >90% as Fe 3 C DRI High-C DRI Analysis Nucor DRP: Metallization 96% Carbon 4.3% Fe 87.3% Fe Total 90.9% Fe 3 C 58.5% Gangue 3.8%

11 100*Combined Carbon/Total Carbon HIGH-CARBON DRI from ENERGIRON-ZR: Stability The DRI with a high content of Iron Carbide exhibits a much lower reactivity (no gas generated in any test conducted) than the standard DRI, as proven by tests from: - HYL lab tests in University of NL in Chilworth Technology Ltd, UK in Korea Institute of Fire Industry & Technology in % Combined Carbon (cementite or iron carbide - Fe 3 C) in DRI from ENERGIRON ZR Process Test Report - Substances that in contact with water emit flammable gases-gas generation in l/hr/kg % Total Carbon in DRI

12 HIGH-CARBON DRI from ENERGIRON-ZR: Stability The High-C DRI from ENERGIRON ZR scheme, exhibits a significantly lower reactivity than the standard DRI. The onset temperature for the High Carbon DRI is higher (>206 C) than for standard DRI (140 C) The tendency to re-oxidize (Oxygen demand reactivity-odr) is lower for the High Carbon DRI (ODR ~ negligible) than that for a Standard DRI (ODR ~ 200 liters/ton/day). High-C DRI Analysis Nucor DRP: Metallisation 96% Carbon 4.3% Fe 87.3% Fe Total 90.9% Fe 3 C 58.5% Gangue 3.8% Conventional DRI analysis: Metallisation 94% Carbon 2.2% Fe 89.2% Fe Total 92.9% Fe 3 C 29.6% Gangue 3.9%

13 HIGH CARBON IMPACT ON EAF AND ENVIRONMENT

14 Packing chemical energy: CARBON in DRI Carbon in EAF is required to reduce residual FeO in the DRI TRADITIONAL DRI C 1.5-2% ~ 20% C in GRAPHITE form LOW-C DRI GRAPHITE/COAL OXYGEN E.E. Low YIELD Injected carbon Particles blow off Ash/impurities ENERGIRON DRI C 1.5-4% C mostly in CEMENTITE form HIGH-C DRI OXYGEN E.E. High YIELD carbon bond to DRI 100% ~ 36 kwh / t LS saved ~ 10 Nm 3 O 2 / 1% C CARBURIZATION IN ENERGIRON PROCESS 3Fe 0 + CH 4 Fe 3 C + 2H 2 CEMENTITE IS SOURCE OF ENERGY IN EAF Fe 3 C 3Fe + C + Heat 2C + O 2 CO + Heat T > 1050 C P 6 8 barg CH 4 > 20% H 2 / CO 5 Fe Fe C Fe For Fe 3 C dissociation heat is: ~ 8 kwh/t DRI for each 1% Carbon Total: ~ kwh/t DRI per each 1% Carbon in the DRI THIS DOCUMENT CONTAINS PROPRIETARY INFORMATION OF TENOVA HYL AND DANIELI & C. SPA NOT DISCLOSABLE, NOT REPRUDOCIBLE. ALL RIGHTS RESERVED.

15 Electricity (kwh/tls) Power on time (min/heat) Graphite Onjection (kg/t) Oxygen (Nm 3 /tls) Example: EFFECT OF HIGH-C/COLD DRI IN EAF % Mtz, 2.2%C (24 Nm3 O2/ton) Electricity (kwh/tls) 94% Mtz, 4%C (40 Nm3 O2/t) DRI Quality Carbon injection (kg/tls) Power on time (min/heat) Oxygen (Nm3/tLS) 5 0 High-Carbon DRI provides very important benefits to the EAF (as per example): It provides additional energy to EAF, as compared to the standard DRI, reducing the electrical power consumption ( Electricity ~ -58 kwh/t) and increasing the EAF productivity ( power on time ~ -4,2min) Reducing or eliminating the need of carbon injection to EAF Additionally, among many others: Creating and maintaining foamy slag throughout the melting process Oxygen injection matching Carbon input (from DRI) and controlled as per DRI feeding rate For users of High-C DRI, there s no going back (i.e. Ternium, Nucor, Suez, ESI)

16 Cost (US$/t LS) Example: EFFECT OF HIGH-C/CDRI & HDRI IN EAF: OPEX Basis of analysis: 100% DRI (cold and hot: CDRI, HDRI-600 C) charge to EAF. 300 Steel Production Cost (based on 100% DRI) High-C DRI from ZR process: 94% Mtz, 3,7%C Conventional DRI from integratedreformer process: 94% Mtz; 2,0%C Costs basis: - iron ore US$110, - natural US$4/GJ, - US$0,06/kWh, - US$0,08/Nm 3, - all others based on international prices Others to EAF Oxygen to EAF Carbon to EAF Energy to EAF Others to DR Energy to DR Iron Ore The difference in steel production cost is evident when using High-Carbon DRI as compared to conventional DRI of ~US$5/t LS HDRI CDRI HDRI CDRI ENERGIRON ZR High-C DRI Other DR technology conventional DRI

17 kg CO 2 /t Liq steel Example: EFFECT OF HIGH-C DRI on CO 2 EMISSIONS The reduction of CO 2 emissions when using high-carbon DRI in DR-EAF steelmaking route is a consequence of: ENERGIRON ZR scheme energy efficiency, which overall energy consumption (as natural gas) of 2.36 GCal/t DRI includes selective CO 2 removal, more efficient and direct carbon feed to EAF through high-c DRI, elimination of graphite addition to EAF for 3.7% C in DRI, decrease of overall energy consumption in EAF (as combined power + oxygen) due chemical input through combustion and dissociation of Fe 3 C CO 2 Emissions from Steelmaking routes (100% DRI-EAF) Power (elect. & oxygen) Coal/natural gas Others (iron ore, fluxes, etc) CO 2 emissions with High-C DRI through ENERGIRON ZR vs. other steelmaking routes/process (location: 0.54 kg CO 2 /kwh) BF-BOF ENERGIRON High-C DRI ENERGIRON Other DR - High-C DRI conventional w/use of CO2 DRI

18 THE REFERENCES: ENERGIRON ZR PLANTS PRODUCING HIGH-CARBON DRI

19 REFERENCES: TERNIUM 3M5 PLANT, MTY, MEXICO 3M5 DR Plant TERNIUM Current 0,7 (from 0,5) Mio tpy ZR Process Scheme High-Carbon COLD DRI: Mtz: 94% Carbon: 3,6%

20 REFERENCES: TERNIUM 4M PLANT, MTY, MEXICO 4M DR Plant TERNIUM Current 0,9 (from 0,7) Mio tpy ZR Process Scheme High-Carbon HOT/COLD DRI: Mtz: 94% Carbon: 3,6%

21 REFERENCES: ESI 3-MICROMODULE, ABU DHABI ESI-3 MICROMODULE 0,2 Mio tpy ZR Process Scheme High-Carbon COLD DRI: Mtz: 94% Carbon: 3,6%

22 REFERENCES: SUEZ STEEL, EGYPT SUEZ STEEL 2,0 Mio tpy ZR Process Scheme High-Carbon HOT/COLD DRI: Mtz: 94% Carbon: 3,5%

23 SUEZ STEEL: Performance Test results DRP ENERGIRON ZR PARAMETER UNIT ACHIEVED RESULT TARGET Production tonne 29,262 29,250 Metallisation (avg) % Carbon content (avg) % Natural gas consumption (avg) Electricity consumption (incl: DRP Core + MH + Aux systems+ CAP) Net Gcal/t DRI kwh/t DRI Hot DRI Temperature C Iron oxide Consumption (dry, screened) t IO / t DRI

24 NUCOR STEEL 2,5 Mio tpy ENERGIRON ZR Process High-Carbon DRI: Mtz: 96% Carbon: 4% REFERENCES: NUCOR STEEL, LOUISIANA

25 NUCOR STEEL DRP: Operation results NUCOR STEEL Is the ONLY DR plant, worldwide, with the demonstrated capability of: Producing 300 t/h Producing DRI with Mtz 96% and Carbon from % Clean CO 2 as by-product Additionally: Considering the DRI quality obtained and selective CO 2 removal, the plant achieves one of the most efficient NG consumption worldwide; just ~2.4 Gcal/t

26 Ezz RMS, Egypt Ezz Rolling Mill Steel- Egypt 1.90 mtpa nominal capacity Cold, high-carbon DRI 93% Mtz; 3% Carbon Successfully passed the Hot Start up after just one week starting hot commissioning

27 THANK YOU