An initial investment by OAO Severstal, one of the world’s leading integrated steel and mining companies, into South African company Iron Mineral Beneficiation Services (IMBS), could see IMBS’s cutting-edge technology enter the global market and having an impact on the current cost of global steel production. The market is expected to grow by approximately 18% every five years, doubling by 2030. This will be driven by increasing demand for steel from the emerging markets of China, India, Russia and Brazil.At stake for IMBS is a race to introduce its FinesmeltTM technology into international markets, currently producing about 1,300 Mt/y, so that the company can capitalise on the estimated three-to-five-year lead over its competitors, and secure a place as the leading, low cost global producer of metallic iron briquettes for the international steel industry. The first step in the process of going global, said IMBS CEO, John Beachy Head, was the deal announced today in which Severstal, acquired a $17 million stake in IMBS. The 25.6% Severstal equity holding will enable IMBS to immediately obtain an international user for its new process and through a Severstal subsidiary, International Iron Beneficiation Group Limited (IIBG), licence steel producers across the world to use the Finesmelt process.The IMBS patented technology will enable steelmakers to use the fines and superfines produced in the beneficiation of iron ore mining, and other mining activities, without agglomeration. The IMBS Finesmelt technology enables these fine and superfine ‘wastes’ to not only be recovered for use from iron-ore that has already been mined, but also from the waste generated at most steel plants. This makes the process significantly environment-friendly over traditional iron and steel making processes as waste dumps may be rehabilitated and eradicated, while energy recovery is optimised and utilised.Explains Beachy Head: “All final steel products are made from crude steel, which is manufactured via one of two routes – The major route, the ‘Integrated Route’, is currently the world’s most utilised method of manufacturing steel, applying processes that use iron ore and coke, which produces a liquid metallic iron in blast furnaces. This is refined in a basic oxygen furnace to produce steel.In the ‘Metallic Route’, electric arc furnaces are used and use a primary feedstock of metallic iron, which is composed mainly of recycled scrap metal, supplemented with manufactured metallic iron, supplemented to make up required volumes. Some form of ladle treatment beneficiates the molten iron to form usable steel.“The technological focus of IMBS has primarily been on the manufacture of low-cost metallic iron for use as a scrap replacement in electric arc furnace steel making, although a secondary application could be the utilisation in blast furnaces and basic oxygen furnaces.”“Because of the demand for construction steels, mainly manufactured through the electric arc process, in the future, scrap shortages will become critical as the scrap recovery lifecycle becomes extended. It is here that the Finesmelt technology, by reducing the reliance on scrap metal, creates a massive opportunity for a low-cost, high volume, metallic iron briquette producer.“IMBS intends to capitalise on this gap in steel making by promoting the use of metallic iron briquettes, taking the electric arc furnace – ‘Metallic Route’, as a fast track to the deployment of steel capacity worldwide.“In addition to the benefits of being able to use the fine and superfine iron-ore waste in steel production, the Finesmelt technology also makes small plants viable. As they are modular, the plants can be constructed on site to make volumes of 50,000 t or more, whereas for traditional steel making production plants to be viable, they must have outputs of 1 Mt or more annually. The plants, being modular, can be either constructed on site to process iron-ore that has already been mined or on site at a steelmakers’ production facility where it can be integrated into the process.“A Finesmelt plant can be erected literally in months, rather than the five-to-seven years required for a major installation, and significant operational savings can be achieved through the use of thermal coal, which is in abundant supply and significantly cheaper than the high quality coking coal required in steel plants.”In South Africa where electricity supply is undergoing major challenges and costs of power are soaring to levels that were unprecedented a few years ago, the Finesmelt technology produces enough thermal energy that if a recovery efficiency of about 30% is achieved, the installation becomes self-sufficient.The final product of the process is a metallic iron powder, which because of its high purity levels, can be cold briquetted for transport. No agglomeration of the raw material is performed, so secondary beneficiation of the reduced product can therefore be performed. As seaborne logistics will play a major part in the transport of the product, the briquetting process will allow significantly larger quantities of iron briquettes to be moved by ship. In a 180,000 t vessel, this could equate to a load valued at $63 million being moved at the same cost as iron-ore with a value of $18 million.The strategic importance of Severstal lies in its ability to assist with deployment of the Finesmelt technology and the value that can be added to IMBS though access to resources and steel making knowledge.“The first commercial plant at Phalaborwa will be operational within 18-24 months. Other participants involved with IMBS are the Industrial Development Corp (IDC) and Palabora Mining Co (PMC). It is intended that the initial production of this plant will be 50,000 t and that this will grow initially to a capacity of 500,000 t and then potentially to a capacity of 2 Mt/y.“Clearly, keeping IMBS at the forefront of technological development in the industry will involve ongoing technological advances. With the involvement of Severstal, this will be a focus going forward and is an objective that we are confident will be achieved,” Beachy Head concluded.