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ArcelorMittal (MT) and Partners Test CO2 Capture Technology

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ArcelorMittal S.A. (MT - Free Report) , in collaboration with Mitsubishi Heavy Industries, Ltd. (MHI), BHP, and Mitsubishi Development Pty Ltd, commenced operating a pilot carbon capture unit at its Gent site in Belgium. This unit is designed to capture emissions from the blast furnace off-gas. The pilot unit, which will run for one to two years, aims to assess the feasibility of scaling up the technology to capture a significant portion of the Gent site's emissions. Since January, engineers have been on site to assemble and commission the unit.

The collaboration, announced in October 2022, involves a multi-year trial of MHI’s Advanced KM CDR Process carbon capture technology across various CO2 emission points, beginning at the Gent steelmaking site. The pilot unit will test emissions from the blast furnace off-gases and the hot strip mill reheating furnace, with potential future trials on other steelmaking gases, such as reformer flue gas from a DRI plant.

The carbon capture development at Gent could support CO2 transport and storage projects in the North Sea region and contribute to global decarbonization efforts in steel production. The EU aims for a CO2 storage capacity of 50 million tons per year by 2030 under the Net-Zero Industry Act. The International Energy Agency (IEA) projects that carbon capture, utilization and storage (CCUS) technology must be applied to more than 37% of primary steel production by 2050, capturing 399 million tons per annum of CO2, to meet the Net Zero Emissions scenario (IEA Net Zero Roadmap – 2023 update).

ArcelorMittal is facilitating the trial at Gent, with MHI providing the carbon capture technology and engineering support. BHP and Mitsubishi Development, key suppliers of steelmaking raw materials to ArcelorMittal's European operations, are funding the trial.

At the consortium meeting in Gent, ArcelorMittal emphasized the company's three-pronged approach to decarbonization — energy efficiency through waste heat reuse and renewable energy, replacing coal with gas and electrification and circular carbon use through CCU and CCS. The installation of the carbon capture unit is a critical step toward achieving carbon-free processes.

MHI highlighted the significance of this pilot in advancing the iron and steel industry’s journey to net-zero emissions and expressed eagerness to deploy its technologies further. BHP and Mitsubishi Development echoed these sentiments, recognizing the pilot as crucial progress in reducing CO2 emissions in the steel sector.

The Gent trial will proceed in two phases. The first phase focuses on separating and capturing around 300kg of CO2 daily from the blast furnace top gas, addressing the technical challenges posed by contaminants. The second phase will test CO2 capture from the hot strip mill reheating furnace off-gases, which include a mix of industrial gases such as coke gas, blast furnace gases and natural gas.

ArcelorMittal’s shares have inched up 0.3% in the past year compared with the industry’s 19.8% rise.

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In 2024, ArcelorMittal anticipates that low inventory levels, particularly in Europe, will result in a rebound in apparent demand with any actual demand increase. The company projects global steel consumption growth (excluding China) of 3-4%, with expected increases of 1.5-3.5% in the United States, 2-4% in Europe, 0.5-2.5% in Brazil and 6.5-8.5% in India.

Optimistic about medium to long-term steel demand prospects, ArcelorMittal is confident in its growth strategy and commitment to providing shareholder returns. MT plans capital expenditures of $4.5-$5 billion for this year, with $1.4-$1.5 billion dedicated to strategic growth projects.

ArcelorMittal Price and Consensus

 

ArcelorMittal Price and Consensus

ArcelorMittal price-consensus-chart | ArcelorMittal Quote

 

Zacks Rank & Key Picks

ArcelorMittal currently carries a Zacks Rank #3 (Hold).

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