The possibility of British Steel bringing a furnace back to Teesside has been described as "complicated and difficult to achieve" but could bring a huge boost to the region.
In the middle of Government talks about supporting the industry to go green by converting the existing furnace at Scunthorpe, it was reported over the weekend that the company - now owned by Chinese giant Jingye - might build two new arc furnaces instead - one on Teesside and one to stay in Scunthorpe - in a bid to qualify for hundreds of millions in state aid.
Tees Valley Mayor Ben Houchen said: “Whilst I can’t discuss any particular investor I may be speaking to, securing the return of steelmaking to Teesside is complicated and difficult to achieve, but I promised to bring steelmaking back to Teesside and I deliver on my promises.”
A British Steel spokesman said: “While decarbonisation is a major challenge for our business, we’re committed to transforming British Steel into a green and sustainable company providing long-term, skilled and well-paid careers for thousands of employees and many more in our supply chains.
"As part of our journey to net zero, it is prudent to evaluate different operational scenarios to help us achieve our ambitious goals.”
Electric arc furnaces (EAF) are a method of steel production which uses electricity to melt scrap metals. The use of oxygen lances to inject oxygen direct into the raw material and melt, reduces more costly electrical energy.
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Chris McDonald, CEO of the Materials Processing Institute in Middlesbrough, which has its own much smaller arc furnace, said: “The suggestion that British Steel would install an Electric Arc Furnace on Teesside isn’t just about going green, it is about improving productivity too.
“I first made this proposal in 2007, to eliminate the high cost of transporting steel slabs from Scunthorpe to the Teesside Beam Mill. If this proposal goes ahead, it will be good news for the environment and good news for the Teesside Beam Mill.
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“We must remember though that it is not good news for the many workers in Scunthorpe where jobs will be lost as a result of this transition. That is why I’m also calling for investment in a “Just Transition” where new green industry and retraining are targeted at areas where jobs are at risk.
"It is vitally important for these communities and for the success of new green industries, such as vehicle batteries and offshore wind.”
The Materials Processing Institute is a not-for-profit UK research and innovation centre focused on supporting the steel and metals sector, together with the wider foundation industries, through the development of advanced materials, achieving industrial decarbonisation, deploying digital technologies and reducing waste.
- Chris McDonald will be one of the in-depth interviews in the next BUSINESSiQ magazine, to subscribe, click HERE
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