Salzgitter Group and LKAB forge technical cooperation agreement

Stockholm – The Swedish mining group LKAB and Salzgitter AG have agreed to cooperate on the decarbonization of the steel industry and have therefore forged a technical cooperation agreement. Both sides perceive the agreement as an important step for the expansion and further development of the decades-long partnership.

According to the SALCOS® - SAlzgitter Low CO2 Steelmaking program, the Salzgitter Group will have incrementally realized virtually CO₂-free steel production by 2033, subject to expedient and suitable economic policy framework conditions and significant public subsidies.

LKAB produces about 80 percent of the iron ore mined in the EU and provides both blast furnace and direct reduction-based steel companies with high-quality, low-carbon iron ore pellets and fines. It has already started to transition its production of iron ore to carbon-free sponge iron (HBI/DRI), a strategy aimed at enabling annual emissions savings of more than 40 million tons of CO₂ in the steel industry before 2050.

Very high-quality iron ore pellets are required for the new steelmaking process via SALCOS^® involving direct reduction plants and electric arc furnaces. The planned technical cooperation entails the companies examining which prerequisites need to be created to achieve this and evaluating the potential development of iron-ore-based raw materials for the future steelmaking process route.

"With our already best-in-industry climate performance and strategy to provide the steel industry with the raw materials to enable decarbonization, first as pellets and then successively as carbon-free DRI/HBI, we want to make this transformation possible together with our customers and suppliers. For such a change to materialize you need not only the incentives and level playing field on the market, but also an industrial value chain approach. The Salzgitter Group and LKAB can continue to build on their long-term relationship for realizing the decarbonization of the steel industry and deliver the cuts to emissions that are so urgently needed,” says Jan Moström, Chief Executive Officer of LKAB.

As Gunnar Groebler, Chairman of the Executive Board of Salzgitter AG, commented: "LKAB and Salzgitter Group are connected by more than 60 years of customer and supplier relations. This success story will now be continued and expanded to include the chapter of decarbonization of the steel industry. Together with strong partners, we are implementing our "Salzgitter AG 2030" Group strategy."

Both companies are also committed to these issues and topics as low-carbon steel production and the respective raw materials lay the foundation for achieving their sustainability targets as well as those of their customers.