The plant, owned by the Jialong Group, will produce steel on an industrial scale by direct hydrogen reduction. The $ 170 million plant was built for 21 months. Its capacity allows producing 300,000 tons of steel per year. On the first day of operation, the plant produced 156 tons of cast iron. Using hydrogen enables excluding the coking from the production process and bypassing the sintering process. This production method eliminates the dust formation, and ordinary steam will be generated instead of CO2.
Steel production in China accounts for 15 percent of the entire industry. Since China plans to become carbon-neutral by 2060, traditional steel production will be gradually replaced by hydrogen production. The new steel production technology allows saving 38% of the costs and reducing emissions of sulfur dioxide and nitric oxide by 98%.