Becoming a reliable domestic supplier of high-quality, customized HBI

In June 2017, Cliffs announced that Toledo, Ohio will be the location of our first hot-briquetted iron (HBI) production plant. The announcement marked an important strategic milestone for Cliffs, as we implement our plans to be the sole producer of high-quality HBI for the EAF steel market in the Great Lakes region. Cliffs is the dominant player and sole supplier of merchant iron units to integrated blast furnace clients in the Great Lakes. The Toledo, OH HBI plant will extend Cliffs’ market reach towards EAF steelmakers.

Premier location for development

Our selected site at the Port of Toledo, approximately 120 miles from our corporate headquarters in Cleveland, is a premier location for development. In determining the best location for the new HBI plant, the relative proximity to future customers in the Great Lakes region was a very important criteria. The HBI plant will be situated in close proximity to a heavy concentration of electric arc furnace steel producers.  In addition, the Toledo site has logistical advantages such as an existing dock, rail access, heavy haul roads for construction and operation logistics, and availability of critical utilities such as natural gas, electrical power, and water.   The location will allow our plant to receive our iron ore pellets produced in Michigan and Minnesota, similar to how we currently supply our existing blast furnace customers. The rail and heavy haul roads give us the ability to serve our customers with fast and reliable deliveries.


 

Project timeline and development

Midrex Technologies has been selected to design, engineer and procure the core equipment of the new plant, which will have the nominal capacity to produce 1.6 million metric tons of HBI per year.  The estimated investment in the entire project is approximately $700 million*.

We anticipate breaking ground for construction of our HBI production plant in early 2018.  The construction period is estimated to take roughly two years, employing approximately 1,200 construction workers during peak times.  Production of commercial tonnage of HBI is slated to begin mid-2020, and is expected to generate about 130 good high-paying Cliffs permanent jobs.

Benefits for EAF steel producers

The same logic, rationale and technical expertise that have made Cliffs so successful in the blast furnace market will be applied to the EAF market.  Much like Cliffs supplies blast furnaces with customized pellets, the Toledo plant will produce HBI customized to our customers’ specifications, allowing EAF customers to produce high-end steel specs.

Environmental Stewardship

The decision to invest in the HBI project in Toledo, Ohio will be transformational for the region, Cliffs, the North American steel industry and is consistent with our core value of environmental stewardship. The HBI project in Toledo will redevelop the brownfield site, exemplifying sustainable development.

Producing steel using HBI requires significantly less energy, and generates lower greenhouse gas emissions compared to traditional processes. The environmental footprint and overall lifecycle of this HBI plant and the products it produces will further improve the energy efficiency and lower the carbon footprint of the domestic steel industry. Natural gas and DR-grade pellets are the only raw materials used in the HBI process.  No hazardous or toxic by-products will be generated from the process.  Water recycling initiatives will conserve water use and minimize discharges. 

*Note: this project’s estimate does not include any construction contingencies.

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