SSAB AB

NIB is participating in the financing of the construction of a fossil-free steel mill in Luleå, Sweden, as part of a consortium, with a loan of SEK 2,250 million (EUR 204.7 million). In addition, NIB has signed a bilateral SEK 1,150 million (EUR 104.6 million) loan agreement with SSAB AB for the same project.

The project will transition steel production from blast furnace technology to electric arc furnace (EAF) technology. The new mill will consist of two EAFs, advanced secondary metallurgy, a direct strip rolling mill, and a cold rolling complex.

The transformation of steel production in Luleå will reduce Sweden’s total fossil carbon dioxide emissions by more than 3 million tonnes per year, equivalent to 7% of the total.

The mill will use both scrap and, in the future, sponge iron from hydrogen-reduced ore pellets. Sponge iron, also known as direct reduced iron (DRI), is produced by reducing iron ore using a gas containing elemental carbon or hydrogen.

Slag processing activities will be relocated, and seawater abstraction at the site will be moved. A new pumping plant will be built for water abstraction, leading to changes in the amount of water abstracted. Additionally, a change is being applied for the waste deposited in the landfill.

The project also means that SSAB will reduce costs and improve its product mix. Lead times will be shortened, and SSAB’s ability to manage short-term fluctuations in demand will be strengthened. The new steel plant will be able to use a flexible mix of raw materials, including fossil-free sponge iron, pig iron, and recycled scrap.

The commissioning of the plant is planned for the end of 2028. Once the new facility is fully operational, SSAB will gradually phase out the existing plant and shut down the blast furnace system.

Productivity:
The mill will be the first fully electrified and digitalised steel production facility, producing advanced high-strength steel with low carbon emissions. This transformation is driven by the growing demand for low carbon steel across various industries.

The partnership with LKAB for sponge iron supply will provide quality and time benefits, mitigating risks related to raw material sourcing.

New skills will be developed among professionals, and the project involves many entrepreneurs, suppliers, and consultants.

After the first phase in Luleå, SSAB plans to scale the technology to a new mini mill in Raahe, Finland.

Environment:
The mill will use both scrap and, in the future, sponge iron from hydrogen-reduced ore pellets. This transformation will significantly reduce Sweden’s total fossil carbon dioxide emissions by more than 3 million tonnes per year, equivalent to 7% of the total.

The CO2 footprint per ton of steel is expected to decrease from 1.7 tonnes to 0.1 tonnes.

Additionally, emissions of inhalable particulate matter, with a diameter of 10 microns or less (PM10) will reduce from 280 tonnes to 80 tonnes per year, and Sulphur dioxide (SO₂) emissions will decrease by 250 tonnes per year, improving ambient air quality.

Pollution discharges to water will be completely stopped, with only cooling water being released, slightly warmer but without added pollution. This project will have a substantial positive impact on both global CO₂ reductions and local air quality.

The new mini mill has undergone a full environmental impact assessment (EIA). The application for the new steel plant, together with the EIA, was submitted to the competent authority on 22.11.2023, and was followed by a public consultation period, with the final permit expected by late 2024.

The entire project will be located at the industrial area of Svartön. This area has been an industrial area since the 40-ties. Today several enterprises are located here like LKAB and the port of Luleå. The land is a filled up shallow bay with hard surfaces and industrial operations with no valuable nature areas.

SSAB’s Science Based Targets initiative (SBTi) goal is to achieve net-zero greenhouse gas emissions across its entire value chain by 2045, in alignment with Sweden’s national ambitions.