We are developing the production of carbon-free sponge iron. This way, we’re taking a step forward in the value chain, increasing the value of our products and giving our customers direct access to the carbon-free iron needed to build the sustainable world of the future.
Sponge iron, or DRI (Direct Reduced Iron), is a more refined product than iron ore pellets. While pellets contain oxygen and must be reduced further, sponge iron is pure and finished iron.
The product itself is nothing new, sponge iron is produced in many other parts of the world, but we will do it using fossil-free technology and over time completely without carbon dioxide emissions. It’s unique, and what we mean when we say that we will take a step forward in the value chain.
Our pellets are among the most climate-efficient in the world today, but our operations still cause large emissions of carbon dioxide. Large emissions also occur later in the process, when the pellets are further processed to finished steel.
By providing our customers with ready-made, carbon-free iron instead, we can skip a step in this chain. Through this, we can contribute to reducing global carbon dioxide emissions by 40-50 million tonnes annually. This corresponds to Sweden’s entire emissions of greenhouse gasses – a huge contribution to the climate. We go from being part of the problem to being part of the solution.
A step forward for the business
There’s more to this than the climate benefits – it is also a prerequisite for LKAB to survive. As we take the step to carbon dioxide-free sponge iron, we can charge more for what we sell, which gives us the conditions to triple our turnover by 2050.
To get rid of the steel industry’s emissions, blast furnaces will be replaced with electric arc furnaces, where scrap steel can be recycled. Scrap alone will not be enough for the world’s needs, though, and therefore new iron ore will continue to be needed. The iron ore pellets of today doesn’t work in electric arc furnaces, sponge iron does. In short: we have to do this.
Together with SSAB and Vattenfall, we’re revolutionising the steel industry! Instead of producing steel in the traditional way, using coal, the goal of the Hybrit project is to develop the technology to use hydrogen instead, with water as the only waste.