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ArcelorMittal (MT) Inks Letter of Intent for Gent DRI Plant
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ArcelorMittal (MT - Free Report) recently announced the signing of a letter of intent with the governments of Belgium and Flanders in support of a €1.1-billion project to build a 2.5 million-ton direct reduced iron (DRI) plant at its Gent site and two new electric furnaces. The DRI plant will ensure nearly 3 million tons of reduced carbon dioxide emissions annually by 2030 as it uses natural gas and potential hydrogen instead of coal to reduce iron ore consumption, thus considerably reducing carbon dioxide emissions.
The plant will function alongside Gent’s blast furnace B, which restarted production in March 2021 after an investment of €195 million investment. Combining the new DRI plant with a sustainable, modernized blast furnace will generate synergies in the efforts to create climate-neutral steelmaking by the company’s Belgium wing.
The support of both governments is vital since the transition to carbon-neutral steelmaking entails high costs. A funding endorsement by the European Commission is another requirement for the project.
The company has several other de-carbonization initiatives on its agenda, including the commissioning of Gent’s Steelanol/Carbalyst and Torero projects in 2022, which promise annual carbon dioxide emissions reduction of 0.9 million tons by 2030.
The initiatives will enable ArcelorMittal Belgium to reduce emissions by 3.9 million tons annually by 2030 and contribute to ArcelorMittal Europe’s aim to attain carbon neutrality by 2050. This is equivalent to the emissions from 848,172 cars being driven for a year.
In its plan for 2050, the company is focused on ensuring energy efficiency, implementing smart carbon technologies like replacing fossil carbon with circular carbon, reforming waste gas into useful compounds, and replacing carbon with hydrogen as a reducing element.
ArcelorMittal expressed gratitude for the support of the government. The project, the third de-carbonization one in the last two months, is a testimony of its zeal and dedication to accelerate the company’s efforts in net-zero steelmaking.
Shares of ArcelorMittal have surged 112% in a year, outperforming the industry’s rise of 88%. Its expected earnings growth rate for the current year is a whopping 1,807.8%.
Image Source: Zacks Investment Research
In its last-quarter earnings call, ArcelorMittal raised its outlook for global apparent steel consumption (ASC) for 2021 as it expects demand to improve further in the second half of the year. It now envisions ASC growth in the range of 7.5-8.5% for 2021, up from its earlier expected growth of 4.5-5.5%. It noted that a favorable supply-demand balance and a low inventory environment are driving utilization levels and healthy steel spreads.
Image: Bigstock
ArcelorMittal (MT) Inks Letter of Intent for Gent DRI Plant
ArcelorMittal (MT - Free Report) recently announced the signing of a letter of intent with the governments of Belgium and Flanders in support of a €1.1-billion project to build a 2.5 million-ton direct reduced iron (DRI) plant at its Gent site and two new electric furnaces. The DRI plant will ensure nearly 3 million tons of reduced carbon dioxide emissions annually by 2030 as it uses natural gas and potential hydrogen instead of coal to reduce iron ore consumption, thus considerably reducing carbon dioxide emissions.
The plant will function alongside Gent’s blast furnace B, which restarted production in March 2021 after an investment of €195 million investment. Combining the new DRI plant with a sustainable, modernized blast furnace will generate synergies in the efforts to create climate-neutral steelmaking by the company’s Belgium wing.
The support of both governments is vital since the transition to carbon-neutral steelmaking entails high costs. A funding endorsement by the European Commission is another requirement for the project.
The company has several other de-carbonization initiatives on its agenda, including the commissioning of Gent’s Steelanol/Carbalyst and Torero projects in 2022, which promise annual carbon dioxide emissions reduction of 0.9 million tons by 2030.
The initiatives will enable ArcelorMittal Belgium to reduce emissions by 3.9 million tons annually by 2030 and contribute to ArcelorMittal Europe’s aim to attain carbon neutrality by 2050. This is equivalent to the emissions from 848,172 cars being driven for a year.
In its plan for 2050, the company is focused on ensuring energy efficiency, implementing smart carbon technologies like replacing fossil carbon with circular carbon, reforming waste gas into useful compounds, and replacing carbon with hydrogen as a reducing element.
ArcelorMittal expressed gratitude for the support of the government. The project, the third de-carbonization one in the last two months, is a testimony of its zeal and dedication to accelerate the company’s efforts in net-zero steelmaking.
Shares of ArcelorMittal have surged 112% in a year, outperforming the industry’s rise of 88%. Its expected earnings growth rate for the current year is a whopping 1,807.8%.
In its last-quarter earnings call, ArcelorMittal raised its outlook for global apparent steel consumption (ASC) for 2021 as it expects demand to improve further in the second half of the year. It now envisions ASC growth in the range of 7.5-8.5% for 2021, up from its earlier expected growth of 4.5-5.5%. It noted that a favorable supply-demand balance and a low inventory environment are driving utilization levels and healthy steel spreads.
ArcelorMittal Price and Consensus
ArcelorMittal price-consensus-chart | ArcelorMittal Quote
Zacks Rank & Other Stocks to Consider
Currently, ArcelorMittal holds a Zacks Rank #2 (Buy).
Other top-ranked stocks in the same space are Nucor Corporation (NUE - Free Report) , Ternium S.A. (TX - Free Report) , and Steel Dynamics, Inc. (STLD - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Nucor has a projected earnings growth rate of 534.4% for the current year. The company’s shares have jumped 110.9% in a year.
Ternium has a projected earnings growth rate of 460.6% for the current year. The company’s shares have appreciated 123.6% over the past year.
Steel Dynamics has a projected earnings growth rate of 431% for the current year. The company’s shares have surged 92% in a year.