Kobe Steel, Ltd. and Mitsui & Co., Ltd. have signed a memorandum of understanding (MoU) on comprehensive cooperation for the Low-CO₂ Iron Metallics Project to commercialize the manufacture and sale of direct reduced iron (DRI) produced through Kobe Steel’s MIDREX Process (earlier post) with Oman’s Public Authority for Special Economic Zones and Free Zones (OPAZ) and also have concluded a Land Reservation Agreement with Port of Duqm Company S.A.O.C. (PODC).

The project aims to produce 5 million tons of DRI with a future expansion plan under study.

OPAZ is an Omani authority that oversees all the special economic zones and free zones in Oman, and PODC is an Omani entity that operates the Port of Duqm. Kobe Steel and Mitsui have also been in discussion with the Sultanate of Oman’s Ministry of Energy and Minerals on detailed condition for natural gas supply. Having confirmed the site and cooperative framework in Special Economic Zone at Duqm in Oman, Kobe Steel and Mitsui will move the feasibility study forward.

The MIDREX Process converts iron oxide into direct reduced iron (DRI) inside the shaft furnace using hydrogen-rich gas coming from natural gas or hydrogen as a reducing agent. More than 90 MIDREX Plants (MIDREX NG Plants) are in operation across the world. Using both carbon and hydrogen molecules in the natural gas for reduction allows an immediate reduction of CO₂ emission by maximum 40% compared to the traditional blast furnace which uses primarily coal.

Kobe Steel owns MIDREX NG as well as MIDREX Flex that can be transitioned to 100% hydrogen and MIDREX H2 using 100% hydrogen as a reducing agent. With use of 100% hydrogen as a reducing agent, MIDREX Flex and MIDREX H2 can reduce CO₂ emissions to zero.

DRI is feed stock for steelmaking. DRI can be used in electric arc furnaces, blast furnaces, and basic oxygen furnace melt shops. Hot briquetted iron (HBI) is DRI in a compacted, briquetted form, which is suitable for long-distance transportation.

Oman is a country rich in natural gas, which is used in the Midrex Process, as well as an suitable location for the Low-CO₂ Iron Metallics Project as the country promotes renewable energies and green hydrogen based on Oman Vision 2040. While natural gas will be used as a reducing agent in the project for the time being, replacement of natural gas by hydrogen and combination with carbon capture, utilization, and storage (CCUS) will be considered to further reduce CO₂ emissions.

The steel industry is working on reduction of CO₂ emissions to address climate change. Kobe Steel Group (also known as Kobelco Group) set the vision for 2050 in May 2021, aiming to achieve carbon neutrality in its production process and contribute to more ethan 100 million tons of CO₂ emission reduction through its technologies, products, and services.

The Group already verified the technology that can reduce a significant amount of CO₂ emissions from blast furnace operations leveraging its collective strength of diverse businesses. Kobe Steel is the first Japanese company that has commercialized low CO₂ blast furnace steel products with the launch of Kobenable Steel. (Earlier post.)