Influence of high grade iron ore usage on the performance of SEA Blast Furnaces

Transcription

1 Influence of high grade iron ore usage on the performance of SEA Blast Furnaces Vinicius M Oliveira, Prachethan Kumar, Dauter Oliveira SEAISI 2017, May 22-24, Singapore

2 This presentation may include statements that present Vale's expectations about future events or results. All statements, when based upon expectations about the future and not on historical facts, involve various risks and uncertainties. Vale cannot guarantee that such statements will prove correct. These risks and uncertainties include factors related to the following: (a) the countries where we operate, especially Brazil and Canada; (b) the global economy; (c) the capital markets; (d) the mining and metals prices and their dependence on global industrial production, which is cyclical by nature; and (e) global competition in the markets in which Vale operates. To obtain further information on factors that may lead to results different from those forecast by Vale, please consult the reports Vale files with the U.S. Securities and Exchange Commission (SEC), the Brazilian Comissão de Valores Mobiliários (CVM), the French Autoritédes Marchés Financiers (AMF) and The Stock Exchange of Hong Kong Limited, and in particular the factors discussed under Forward-Looking Statements and Risk Factors in Vale s annual report on Form 20-F.

3 1. Introduction 2. Sinter Pot Tests 3. Value-in-Use Discussion 4. Summary

4 Introduction

5 SEA growth requires steel, which calls for iron ore ASEAN GDP growth rate, % World steel production Country e Myanmar Laos PDR Cambodia Philippines Vietnam Indonesia Malaysia Thailand Singapore Brunei Average Source: Source: Steel demand is increasing rapidly in SEA. When will SEA steel production follow same growth as GDP? 4

6 Vale is the world leader of iron ore production & reserves Vale Reserves (1)(2) (Bi t) production (3) (Mt) Northern System Reserves (1)(2) (Bi t) production (Mt) PA 5 mines Western System 2016 production (Mt) 2.3 MS MG 20 mines 2 mines Southern and Southeastern Systems Southern Southeastern Reserves (1)(2) (Bi t) Note: (1) figures in billion metric tonnes of ROM on wet basis (Bi t). (2) Samarco s reserves (2.91 Bt) not included. Vale's equity interest in Samarco s mines is 50%. The above figures include non-operating mines: S11D and Apolo. (3) Production figures do not include third-party ore purchases. Source: Vale s statement of reserves. Form 20F/ 2016 (submitted on April 10th, 2017) 2016 production (3) (Mt)

7 Vale can contribute with an efficient iron ore supply chain 27 mines in 4 production systems 13 pelletizing plants (Brazil and Oman) 3 railways and 4 ports in Brazil 2 DCs and 5 blending ports 6 Source: Vale

8 And brings its mines closer to Asia via Distribution Centers Ore in large vessels 35 days 3 to 10 days Blend sold in smaller vessels to clients with logistics restrictions Ore in large vessels Large Vessels Smaller Vessels 400,000 DWT 220,000 DWT 170,000 DWT 80,000 DWT 10,000 DWT Ores from North & South of Brazil in large vessels The ore is blended in Malaysia and sold to clients in Southeast Asia, Taiwan, East India and South China in small (Handymax), medium (Panamax) and large vessels (Capesize). 7

9 Mixing Brazilian in Blend Malaysia Fines to (BRBF) produce Efficient BRBF blending Brazilian Blend Fines Blending effect in variability SiO 2 BRBF Brazilian Blend Fines PRODUCT Fe SiO 2 Al 2 O 3 P Mn LOI H 2 O +6.3mm +1.0mm -0.15mm BRBF Al 2 O 3 94% less Before After 72% less Variance to mean Mixing is performed in 3 steps and it is strictly controlled via control room. Low quality variability is achieved. Final blend achieves stable quality, low moisture and good handling. 7

10 Benefits to the clients for receiving cargoes from Malaysia DELIVERY LOT SIZE Big lot sizes Customer stock behavior thru time Average stock Capesize Small lot sizes Average stock Panamax DELIVERY LEAD TIME VARIABILITY from Brazil CUSTOMER Logistics Benefits DELIVERY LEAD TIME from Brazil from distribution facilities Customer from distribution facilities Higher safety stock Stock in transit behavior thru time Higher in transit stock Lower safety stock Lower in transit stock 9

11 Sinter Pot Tests

12 Sintering Pot Test facilities used to evaluate BRBF Sinter pot facilities at Vale R&D in Brazil Cement type mixer Dry mixing 2 minutes Wet mixing 6 minutes Sinter pot operational parameters Parameter Experimental conditions Bed height, mm 550 Return fines, % 30 Suction pressure, mmh 2 O 1,500 Burnt lime level, % 3 Dry mixing time, min 2 Wet mixing time, min 6 Cement mixer rotation, rpm 18 Height: 550 mm : 300 mm Pmax: 1,500 mmh 2 O Sinter simulation technique French (IRSID) sinter return fines is kept balanced (input = output) by adjusting the proportion of solid fuel in the mix. 11

13 BRBF has superior quality compared to other major players % Fe % SiO 2 % Al 2 O 3 %P BRBF (Brazilian Blend Fines) has a very competitive quality in terms of chemical and physical properties (2 nd Best from Vale after Carajas fines IOCJ ) VALE AUS A AUS B AUS C AUS D AUS E Note: - Vale ores: specs 2017 % LOI % mm % mm

14 BRBF has a proper microstructure for sintering Vale sinter feeds are formed by hematite crystals (low LOI), and BRBF has good combination of different crystal shapes (morphology) Mineralogical composition Brazil (Vale) Iron ore Australia Mineralogy (%) Hematite Goethite Magnetite Others IOCJ SSFT SSFG BRBF A B t 4 B C t 3 C t 1 BRBF - Hematite s crystal morphology * %Vol. t = trace The lower amount of goethite in Brazilian ores contribute to lower LOI (less calcination) compared to Australian ores.

15 BRBF has a proper microstructure for sintering The BRBF has high porosity and crystals size ranging from very fine to medium which contributes for high productivity in sintering together with good sinter strength. Vale s ores have good combination of crystal sizes from very fine to medium. In average Vale ores range from 26 to 60 mm. Scanning electron microscopy image of the BRB crushed into the fraction -0.5mm +0.25mm

16 Sinter Additives IO mix IO type Unit BRBF was tested replacing different ores Option Base Case Reference Case 1 BRBF x Au Blend Case 2 BRBF x Aussies Case 3 BRBF x Pisolite Case 4 BRBF x Pisolite (full replacement) Aussie Blend % Aussie Pisolite % Aussie Marra Mamba % Aussie Brockman % IOCJ % SSFT % BRBF % LOI % mm % mm % Dolomite kg/t Limestone kg/t Quartz kg/t Burnt lime % Coke breeze % Fe % SiO 2 % MgO % Al 2 O 3 % B Note: return fines fixed in 30%. To avoid any impact of chemistry in sinter properties, quartz addition was used for fine tuning and keep SiO 2 constant in the sinter.

17 BRBF Sinter Pot Test Evaluation Sintering Performance Productivity: Good performance is sustained when BRBF is introduced by replacing Aussie ores. In the cases 3 and 4, where BRBF replaced coarse Pisolite ore, the iron ore mix size distribution became finer (+1.00mm and -0.15mm ). Nevertheless, the productivity was maintained even using the same level of burnt lime. Fuel consumption: Fuel rate decreased in all cases when BRBF was introduced (min: 4% ; and max: 8% ; both relative to Base Case ). In general, the use of BRBF replacing Australian ores led to a good performance in sintering with savings in fuel consumption.

18 BRBF Sinter Pot Test Evaluation Sinter Quality Sinter Strength The use of BRBF in the IO mix replacing Aussie ores didn t compromise sinter strength, even with lower fuel consumption. In some cases, a slight increase could be noticed in Tumble Index (TI) and in sinter Mean Size. Sinter size distribution Size Base Case Reference Case 1 Case 2 Case 3 Case 4 % > mm % < 6.30 mm Mean Size, mm Sinter Metallurgical quality Improvement in RDI with the introduction of BRBF (strong correlation with Al 2 O 3 in the sinter) in IO mix. The Reducibility showed slight reduction with BRBF, however this trend wasn t observed in the sinter microstructure evaluation. The use of BRBF replacing Australian ores kept sinter quality at good level, with some slight potential upside in TI and RDI.

19 BRBF Sinter Pot Test Evaluation Conclusion IMPACT OF BRBF USE: Chemical Quality General improvement (Fe, SiO 2, Al 2 O 3 ); Process Performance Can replace different Aussie ores at various levels and reduce fuel consumption by keeping sintering productivity. Sinter Quality Higher levels of BRBF show good sinter strength (TI and Mean Size). Significant improvement in sinter RDI with neglectful impact in reducibility (validated by previous S&M tests). With BRBF there some positive signs (Ferrites, Magnetite, Silicates ) that contributes to better metallurgical performance. The use of BRBF in a typical Asian sintering iron ore mix led to a good general performance in sintering process and sinter quality.

20 BRBF combines the best of Vale ores for high performance Crystal Size < 30µm 40~70µm >80µm IOCJ Productivity BRBF SSFs Sinter Strength BRBF is the only blend with the perfect mix of different crystal sizes. It is the optimum combination to increase productivity and sinter resistance

21 Value-in-Use Discussion

22 Brazilian Blend Fines Top position in Relative Value RELATIVE VALUE SINTER FEEDS IODEX62 Zero Gangue (SiO 2 +Al 2 O 3 ) calcined Al 2 O 3 LOI Fe Fines (Size) Phos + Slag -> + Coke + Sinter RDI -> + Coke + Coke breeze & Less Sinter + IO Consumption + Burnt lime consumption + De-Phos cost in BOF HIGHER COST LESS VALUE FOR IO Reference: IODEX62 Spec (level zero) Considers: Particular operation of a steel mill in JKT using Feb/2016 price of indices + premium/discounts for iron ore and metallurgical coal

23 BRBF is a good replacement for Aussie ores BRBF can improve performance in ironmaking Simulation: BRBF vs Aussie Ore Sintering IO Mix Base case With BRBF Aussie Pisolite 53% 23% Aussie 62% 23% 23% Aussie 58% 3% 3% IOCJ 8% 8% SSFT 5% 5% BRBF -- 30% Others 8% 8% ~2.5% ~5kg/t ~1kg/t ~0.5% Increase in Sintering Productivity Reduction in Slag Rate Hot Metal Reduction in Coke Rate Hot Metal Increase in Blast Furnace Productivity ~5.5kg/t Reduction in CO 2 emissions Hot Metal Considers average price of indices + premium/discounts of 2016 for iron ore and metallurgical coal Calculation based on US$ - CFR China Source: Vale

24 Summary

25 BRBF Trials and Client s feedbacks Excellent handling (low moisture, no free water), especially during vessel discharge (photos below -> higher discharge rate, no chute clogging, and less need of cleaning); Good agglomeration properties (easy formation of quasi-particles); Good metallurgical properties (enhanced assimilation with CaO); Good sintering performance Keep high level when replacing traditional players; Slight positive impact on productivity when replacing Pisolite ores.

26 Benefits to the clients for receiving BRBF Vale believes that BRBF can deliver additional value for the customers through: - High Productivity in Sintering; - Good Physical & Metallurgical properties of the sinter at low and high temperature. Technical Logistic - Flexible Lot Sizes; - Lower Delivery Lead Time; - Lower Stocks. - Flexible Sales Formats / Channels; - Incoterm (FOB / CFR); - Sales Term (SPOT / STC / LTC). Commercial

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