DRI Direct Reduced Iron

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DRI Direct Reduced Iron What is DRI? Sponge iron/dri has gained great prominence in world as a substitute of steel scrap (partially) in steel making in electric arc furnace and in induction furnace. Direct Reduction is a metallurgical process of producing sponge iron from iron oxides (mainly from lump iron ores or pellets) directly in the solid phase. The product of this solid state route has a honeycomb structure with minute pores. Hence this product is most commonly known as sponge iron/direct reduced iron (DRI). This product is in three types of A (Hot-molded briquettes), B (Lumps, Pellets and cold-molded briquettes) and C (by-product fines), with moisture content up to 0.3 percent. Methods of production: There are various proven commercial methods of DRI production such as: Blast furnace Corex Midrex Hylsa SL/RN Midrex is the most common type in Iran.

UPGT - Direct Reduced Iron page 2 Midrex Process: Midrex is direct reduction process using a shaft-reactor and is developed by Midrex/Kobe Steel. Iron ore pellets, lump iron ore or a combination of pellets and ore are reduced in a vertical shaft or reduction furnace to metallic iron by means of a reduction gas. The reducing gas is produced from a mixture of natural gas and recycled gas from the reduction furnace. The mixture flows through catalyst tubes where it is chemically converted into a gas containing H2 and carbon monoxide (CO). The desired reducing gas temperature is typically in the range of 900 C. As the iron ore descends through the furnace by gravity flow the gas ascends through the material column and removes oxygen from the iron carriers. The product, DRI, is typically 90% to 94% iron. After the DRI exits from the bottom of the shaft, it can be compressed to hot briquetted iron (HBI) for safe storage and transportation. A derivative of the Midrex process can use coal through gasification (MXCOL Technology). The MIDREX process represents 70% of the installed DRI capacity worldwide. The largest plant in operation has a capacity of 1.76 Mt per year, about half the capacity of a standard-size blast furnace. Typical analysis of final product in Midrex process is as below: Elements Typical analysis Fe (total) 90% Metallization >92% C >1.50% SiO2 + Al2O3+ CaO+ MgO 4.5 max S 0.005% P 0.04% Cu +Cr +Ni +Mo +Sn +Pb Traces The MIDREX Process: The process offers the following benefits: Using natural gas and agglomerated iron ore makes the process simple The packed reactor with the counter-current flow of reactants provides a high efficiency The process is highly flexible with regards to iron ore reducing gas sources

UPGT - Direct Reduced Iron page 3 DRI advantages: The demand of sponge iron is increasing day by day because of following reasons: Reduced availability of consistent quality steel scrap. Fluctuation in steel scrap price. Consistent quality of sponge iron with absence of tramp like copper, tin, arsenic, chromium, nickel, lead and etc. Relatively firm sponge iron price. High iron content and high degree of metallization Minimum dust generation during material handling Known sponge iron composition leads to accurate end point steel making. Viable and sponge iron manufacturing due to its captive generation. Use of higher percentage of sponge iron in the charge mix of induction furnace (IF) and electric Arc Furnace steel making. Advantages of using Sponge Iron in Electric Arc / Induction Furnaces in the charge mix are: DRI permits automatic continuous or batch charging. It helps create a foamy slag - provides lower electricity consumption, faster melting time. decreased electrode consumption, longer refractory life and enhanced steel quality The chemical composition of DRI is known exactly and is uniform It contains very low levels of undesirable metallic impurities Use of DRI permits dilution with low cost (more available) scrap. Less noise occurs during melt down with DRI than scrap. It does not require de-sulphurising and de-phosphorising process in Electric Arc / induction furnaces.

UPGT - Direct Reduced Iron page 4 Sponge iron production in Iran and comparison with other countries: In the year of 2014 I.R.Iran by producing more than 14.5 million tons after India and standing upon countries such as Mexico and Qatar is the biggest producer of sponge Iron in the world. The main reason of high rate of production in few countries is refer to gas and coal resources as the main factor of energy production for direct reduction. In India about 70% of sponge Iron production is perform by using of coal and the 30% by using of gas. The rest of the mentioned countries use gas as the thermal resource. From 10 years before the production of DRI has been doubled and anticipate by utilizing of 8 under construction factories in 2 years ahead, Iran become the biggest producer of sponge iron in the world.

UPGT - Direct Reduced Iron page 5 Khorasan Steel Complex Based on feasibility studies in Khorasan province by Kobe Steel of Japan in 1368 Khorasan Steel Complex, in an area of 1,400 hectares located 15 kilometers North West of the city of Nishabur and with operation of factories: light structural steel rolling mill with a capacity of 550 thousand tons, Capacity of 630 thousand tons of steel billets and 2 units of direct reduction each with a capacity of 800 thousand tons per year and is going to establish its development units includes steelmaking unit number 2, with the capacity of 720 thousand tons, pelletizing unit with the capacity of 5/2 million tons and 5/2 million tons concentrate and the development program of construct steel making and roll, stabilized its place in Razavi Khorasan as the third pole of steel in Iran. Capacity: 630 thousand tons of steel billets Two units of direct reduction each with a capacity of 800 thousand tons per year going to establish steelmaking unit number two, with the capacity of 720 thousand tons pelletizing unit with the capacity of 5/2 million tons and 5/2 million tons concentrate

UPGT -Direct Reduced Iron page 6 Arfa Steel Arfa Iron and steel Co. limited was established on 1383. Activities of this company is iron and steel manufacturing with direct reduced methods, steel making operations with steel smelting and casting processes in different methods and different types of rolled ferrous metals and production of geometric sections, construction of units and related industries. Projects anticipated are based on the results of studies done in IMIDRO, persuading in creating new plans to increase annual production capacity of 32 million tons Fast and convenient access to major parts of the country by road and railways Near to the main raw material suppliers. Availability to provide infrastructure needs such as water, gas and etc. Ghadire Iranian Iranian Ghadir steel project in 1386 was placed on the agenda to be operational in 1388. Iranian Ghadir Iron and Steel Company, as executor of the project, selected Ardakan as the project location. The purpose of this project was to build the capacity of direct reduction unit 800 Thousand tons per year.. South Kaveh Steel Company (SKS) Kish South Kaveh Steel Company (SKS) is one of largest investments in infrastructural industries in Iran. It lies in a plot of land with 70,000 square meters in Persian Gulf Mining & Metal Industrial Special Economic Zone, since 2007. Their main product is sponge iron at this stage, and they are going to develop their activities in regard with pelletizing plant, steel making plants (including two units), rolling-mill workshop, and other relevant industrial facilities This company has 2 units of direct reduction with a capacity of 2,200,000 metric tons per year. (Module No.2 is under construction) South Kaveh Steel Company Capacity: up to 2.2 million tons per year

UPGT - Direct Reduced Iron page 7 DRI properties and dangers: DRI in either form is similar to other steel structures in its susceptibility to rust (re-oxidize) in the presence of oxygen. The rate of oxidization is dependant, to a greater or lesser degree, on the moisture content of the DRI and the atmosphere in which the DRI is carried. The oxidization process generates heat, which in bulk cargoes of DRI can be significant. The process of oxidation is accelerated in the presence of moisture and is substantially increased if the water contains dissolved chlorides, as is the case with seawater. The spongelike structure of DRI also inhibits the dissipation of heat and DRI in bulk can therefore heat rapidly in isolated pockets. Hazards: Oxygen depletion: Cargo spaces containing DRI Fines, as well as enclosed adjacent spaces may be oxygen-depleted, and all due caution should be exercised upon entering such compartments. In closed compartments, the oxygen content may drop to 5 percent. In surface ventilated holds, the oxygen content may vary between 15 and 20 percent. The minimum oxygen content in any space for life supporting should be 21 percent. Hydrogen accumulation: The primary hazard associated with DRI Fines is the accumulation of hydrogen in enclosed spaces, such as ship holds and adjacent spaces because of the generation and release of hydrogen as mentioned in Section 2.4.4 of this guide. Material evolves hydrogen because it contains moisture (> 0.3 percent and up to 12 percent). The mechanism involved is the aqueous corrosion of iron. Hydrogen concentration should not be allowed to exceed 1 percent by volume (25 percent LEL) in any cargo space or adjacent enclosed space. Self-heating: DRI Fines may self-heat upon reacting with water or air, although this is a secondary risk. Temporary selfheating of about 50 Celsius (125 Fahrenheit) may be expected after the material is handled in bulk. DRI Fines should not be loaded if material temperature is in excess of 65 Celsius (150 Fahrenheit). DRI Fines are non-combustible and have a low fire risk. Great care must be taken to prevent seawater from entering the holds, as wetting the DRI Fines with salt water will greatly accelerate the rate of hydrogen gas emission. Dust emission: As with most bulk cargoes, handling DRI Fines will generate dust. Appropriate clothing, respirators, and eye protection must be worn by personnel working in the vicinity during handling, loading and unloading of DRI Fines.

UPGT - Direct Reduced Iron page 8 SGS Report April 28 th 2013 INSPECTION NO.:13-59234L02 SGS Report May 27 th 2013 INSPECTION NO.:650201/48534 DRI Razi Lab - Februry 17 th 2013 Analysis Report NO.:37938 CBI Razi Lab - April 10 th 2013 Analysis Report NO.:41566

UPGT - Direct Reduced Iron page 9 SGS Report April 20 th 2013 INSPECTION NO.: 650201/49278 SGS Report November 11 h 2015 INSPECTION NO.:650201/58787