May 2007 - SIMA

May 2007 - SIMA

May 2007 - SIMA


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N.K. PATNAIK<br />




P.R. Dhariwal<br />

N.K. Patnaik<br />

Suresh Thawani<br />

Vikrant Gujral<br />

R.H. Dalmia<br />

G.K. Chhanghani<br />

Manoj Agarwal<br />

Narayan Tekriwal<br />

S. Subramanian<br />

Anil Ahuja<br />

S.S. Bhatnagar<br />


Prakash Tatia<br />

G.K. Chhanghani<br />

Nirmal Aggarwal<br />

Surender Dalmia<br />

M.K. Sheshadri<br />

Sunil Garg<br />


The Indian economy is on the fulcrum of an ever<br />

increasing growth. It grew by an impressive 9.2%<br />

during the second quarter of 2006-07 taking the gross<br />

domestic product growth to an impressive 9.1% in<br />

the first half. With robust growth and government<br />

focus on construction and infrastructure projects,<br />

steel requirement has grown substantially. The<br />

modest target of steel production of 65 Million Tons<br />

by 2010-11 has been revised by the government<br />

agencies and steel producers to 80 Million Tons.<br />

The Indian steel production by 2020 as per the newly<br />

revised estimates is expected to reach 180 – 200<br />

Million Tons by 2020.<br />

India again emerged as world’s largest producer of sponge iron for the 5TH consecutive year with record production of 14.74 Million Tons for the calendar<br />

year 2006. Gas based units have shown a growth of 7% due gas supply<br />

limitations, whereas Coal based units had a significant growth of 32.96%<br />

giving overall industry growth of 22.99%.<br />

The difficult availability of steel melting scrap and limited reserves of coking<br />

coal in addition to their unprecedented rising prices makes future steel making<br />

heavily dependant on the sponge iron industry ,as it has to meet the fast<br />

growing needs of quality metallics by the steel sector. In this scenario a<br />

promising future beckons the sponge iron manufacturers, who have been<br />

charting ambitious new projects and expansion plans. But before these plans<br />

materialize, everyone appears to be focused on ensuring the security of vital<br />

inputs namely; iron ore, non-coking coal and natural gas. The major concern<br />

is to get consistent iron ore supplies, long term linkages /contracts of superior<br />

quality sponge iron grade non-coking coal and at least committed supplies<br />

of natural gas for better utilization of installed capacities.<br />

To avoid a situation whereby capacity creations lags behind demand growth,<br />

the government initiatives and policies have to be proactive. We need to<br />

improve our infrastructure namely; roads, ports, airports, railways, highways<br />

etc. We are also not proceeding fast enough in building up the power sector.<br />

An improved and efficient Railways will also reduce tariff. Railway freight per<br />

1000 KM per ton is nearly three times higher for steel and related sector in<br />

India than in China and Korea. An integrated approach is required to ensure<br />

that the sponge iron industry grows to its full potential and meets the<br />

challenges ahead, to meet the galloping demand of quality metaliks by steel<br />

sector.<br />

On the whole the Indian Sponge Iron Sector has all signs of a vibrant and<br />

positive industry. It is our constant endeavour at <strong>SIMA</strong> to give you a<br />

comprehensive picture and analysis of the developments that are taking<br />

place. <strong>SIMA</strong> has also improved its international profile with visits to Indonesia,<br />

Egypt and Muscat. Interaction, commitment , support and co-operation of<br />

the members are our biggest strengths as we move to greater successes<br />

every year.<br />



With an aim of preserving precious iron ore for the use by Indigenous steel mills, Finance Bill<br />

<strong>2007</strong> has introduced levy of export duty of Rs. 300/- per ton on the exports of iron ore.<br />

This must have cheered the members of <strong>SIMA</strong> as way back in 2003, through a detailed<br />

presentation on iron ore scenario in <strong>SIMA</strong> AGM, in the presence of the then Hon’ble Minister<br />

of Steel Mr. B K Tripathi, I had stressed that unless Govt takes measures to regulate the<br />

exports of iron ore, India might need to start import of iron ore.<br />

Since despite this measure, export of iron ore has shown increasing trend, we hope that<br />

Government of India would take a decision soon either to curb or ban exports of iron ore: as ore export s an<br />

export without any value addition and thus eating away possible inflow of forex into India and job opportunities<br />

in the country. Iron ore needs to be used wisely as an anchor for growth and development of the domestic<br />

steel industry. In fact iron ore is the prime reason why we have multinational corporation wanting to get into<br />

India. We have already proposed to the government to phase out iron ore export in progressive manner by<br />

putting cap on iron ore exports at current level. The reduction in iron ore export by 15% every year and finally<br />

export to be made zero by year 2011-12 by which time the demand is expected to match the level of production<br />

of iron ore in the country. Imposition of Rs.300/- per ton is only a symbolic representation and possibly the<br />

first step towards conservation and security of our finite reserves of iron ore.<br />

Over the years coal based sponge iron producers have been facing acute shortage in supply of quality and<br />

quantity of non coking coal for the manufacture of sponge iron mainly due to such policy of the Government<br />

which makes the middlemen (traders) more powerful distributor and thus affecting the end consumer.<br />

Meanwhile our Vice Chairman Mr. N K Patnaik alongwith O<strong>SIMA</strong> Chairman Mr. G S Agrawal & representatives<br />

of coal based units, presented comments and suggestions, to be implemented in the proposed new Coal<br />

Distribution policy, to the newly constituted Committee chaired by Secretary Coal, which has been set up<br />

under the directives of Hon’ble Supreme Court, to evolve a viable and fair Coal Distribution policy. This is a<br />

good step emanating from Supreme Court directive and we hope our suggestions and comments will find<br />

place in the new policy thus bringing relief to the coal based units.<br />

While the Govt of India has recognized our association’s value and takes inputs at the time of formulating a<br />

policy, our international exposures, viz admission of foreign members, foreign visits improve vision and sharing<br />

of technological expertise have been of immense use to the members. It is heartening to note that our<br />

association took a strong delegation recently to Muscat to attend Arab Steel Summit <strong>2007</strong> organised by Arab<br />

Iron & Steel Union(AISU).<br />

I hope the new journal reaches your desk by the time we meet again on 10 th <strong>May</strong> <strong>2007</strong> for Annual General<br />

Meeting, in Delhi.<br />

Wishing you all the best.<br />



Introduction<br />




By:<br />

Robert Cheeley, Sales Manager<br />

John Kopfle, Director – Corporate Development<br />

Dr. Jayson Ripke, Plant Sales Manager<br />

Midrex Technologies, Inc.<br />

Irek Wanicki, Lead Process Engineer<br />

Pauli Baumann, Licensing Manager<br />

Sasol-Lurgi Technology Company (Pty) Ltd<br />

As one of the world’s most vibrant and growing<br />

economies, India has a strong steel demand for<br />

infrastructure, construction, and consumer goods.<br />

Its steel demand is growing at seven percent per<br />

year. To feed this demand, steel production has<br />

grown from less than 10 million tons (Mt) in 1980 to<br />

over 44 Mt in 2006, as shown in Figure 1.<br />

Figure 1<br />

India Steel and DRI Production<br />

Sources: IISI and Midrex Technologies<br />

There are ambitious plans to increase the country’s<br />

steel production, with the Indian government having<br />

set a goal of 110 Mt by 2020.<br />

Approximately 45 percent of the India’s steel is<br />

currently produced in electric furnaces. Given the<br />

lack of domestic scrap and the good availability of<br />

natural resources like iron ore, coal and natural gas,<br />

direct reduction has provided much of the iron units<br />

required for Electric Arc Furnace (EAF) steel<br />

production growth. Direct Reduced Iron (DRI)<br />

production has increased tremendously since 1980,<br />

from essentially zero to over 15 Mt in 2006, as shown<br />

in Figure 1. Of the total DRI production in 2006, 68<br />

percent was produced from coal and 32 percent from<br />

natural gas. India is now the world’s largest producer<br />

of DRI.<br />

There are two primary means of DRI production in<br />

India: small-scale rotary kilns using local coal and<br />

iron ore lump, and large-scale shaft furnace plants<br />

using natural gas and iron oxide pellets and lump.<br />

In recent years, almost all the growth in DRI<br />

production has been due to the installation of rotary<br />

kiln facilities and there are now over 350 of these<br />

plants. Many are small-scale and it is believed that<br />

over 100 have capacities from 10,000-20,000 tpy.<br />

There are only seven natural gas-fired shaft furnace<br />

plants (including six MIDREX® Modules), but they<br />

produce nearly half as much DRI as all the rotary<br />

kilns combined.<br />

Technologies for Growth<br />

For India to grow its steel production significantly,<br />

what are the options? Direct reduction using coalfired<br />

rotary kilns or natural gas-fired shaft furnaces<br />

are logical choices. Rotary kiln DRI has been<br />

installed because it makes use of domestic iron ore<br />


and coal, but there is a limit to the growth of this<br />

technology because rotary kilns cannot be built<br />

larger than about 200,000 tpy. Thus, it is probably<br />

not feasible to build a steel mill to produce one million<br />

tons per year or more via this route. Also, there are<br />

product quality issues because of the use of lump<br />

ore and coal with high levels of ash and sulfur. Direct<br />

reduction plants using natural gas would be an ideal<br />

choice, but there is little natural gas available now<br />

for further expansion.<br />

Another possibility is the installation of conventional<br />

blast furnace/basic oxygen furnace technology, but<br />

this requires the importation of coking coal or coke,<br />

since only about five percent of India’s coal reserves<br />

are coking quality. Also, there may be environmental<br />

issues and the capital cost can be high.<br />

Gasification/MIDREX®<br />

An alternative option is the use of a coal gasification<br />

technology in combination with a MIDREX® Direct<br />

Reduction Plant. The coal gasifiers would use Indian<br />

coals to generate a synthesis gas (or syngas) that<br />

can be an acceptable reducing gas source for<br />

producing DRI in a MIDREX Plant. A generic<br />

flowsheet showing the Gasification/MIDREX concept<br />

is shown in Figure 2.<br />

Figure 2<br />

Gasification/MIDREX Flowsheet<br />

There are three general types of gasifiers: fixed bed,<br />

entrained flow, and fluidized bed. While each of these<br />

can make an acceptable reducing gas for a MIDREX<br />

DR Plant as an alternative to reformed natural gas,<br />

the fixed bed technology is a preferred choice for<br />

India because it can accommodate the high ash<br />

domestic coals. The leading fixed bed process is<br />

the Sasol-Lurgi Fixed Bed Dry Bottom (S-L FBDB)<br />

process, licensed by the Sasol-Lurgi Technology<br />

Company (Pty) Ltd (SLTC), South Africa.<br />

The S-L FBDB Gasification process is a moderate<br />

temperature and pressure process. Coal is gasified<br />

at elevated pressures of the order of 30 bar(a) in<br />

the presence of high pressure steam and pure<br />

oxygen to produce a synthesis gas suitable for the<br />

production of amongst others, fuels and chemicals<br />

when combined with synthesis conversion<br />

technologies. The technology is well-proven, over<br />

102 gasifiers in commercial operation worldwide, the<br />

earliest of these built in 1955. Eighty of these units<br />

are deployed in South Africa, using coals very similar<br />

to Indian coals.<br />

The characteristics of the S-L FBDB Gasifier are as<br />

follows:<br />

Operating pressure<br />

20-40 barg<br />

Feedstocks / Utilities<br />

Lump coal (5-50 mm)<br />

Oxygen (approx. 99 mol%)<br />

High pressure (H.P.) steam<br />

Gas Cleaning & Conditioning<br />

Hot syngas is cleaned and cooled by a direct<br />

contact water scrubber, followed by indirect air cooler<br />

and water cooling<br />

Trace components, most of sulfur (H2S) and CO2<br />

removed by a Lurgi Rectisol® unit at tail end of plant<br />

Sulfur is recovered in Claus process with Claus tail<br />

gas processed in Lurgi Tail Gas Treatment® process<br />

achieving >99% sulfur recovery.<br />

Produces valuable and saleable coproducts<br />

Phenols<br />

Ammonia<br />

Coal oil<br />

Elemental sulfur<br />

Low pressure (L.P.) steam<br />


Figure 3 shows the S-L FBDB gasifiers in Secunda,<br />

South Africa.<br />

Figure 3<br />

S-L FBDB Gasifiers in Secunda, South Africa<br />

The high pressure syngas exiting the Rectisol plant<br />

after the S-L FBDB plant contains approximately 85<br />

percent H2+CO, 2.5 percent CO2, and the rest is<br />

mostly CH4. The H2/CO ratio is about 1.6, which is<br />

the same as used in a natural gas-based MIDREX<br />

Plant.<br />

In the MIDREX Plant, the cold syngas is first<br />

depressurized to about 3 barg by a turboexpander.<br />

The low pressure syngas is then mixed with recycled<br />

top gas to produce the required reducing gas. The<br />

mixed syngas is then heated to over 900º C. The<br />

hot gas enters the MIDREX® Shaft Furnace where<br />

it reacts with the iron oxide to produce DRI. The<br />

reduction reactions are shown below:<br />

Fe2O3 + 3H2 —> 2Fe + 3H2O<br />

Fe2O3 + 3CO —> 2Fe + 3CO2<br />

The spent reducing gas (top gas) exiting the shaft<br />

furnace is scrubbed and cooled, then passed<br />

through a CO2 removal system. This reduces the<br />

CO2 content to five percent or less, which ensures<br />

that the mixed reducing gas (syngas from the<br />

gasification plant and recycled top gas from the<br />

MIDREX Plant) has an acceptably high reductants<br />

(H2+CO) to oxidants (H2O+ CO2) ratio for efficient<br />

iron ore reduction. The CO2 removal system will also<br />

remove the sulfur gases contained in the recycled<br />

top gas.<br />

By conditioning the syngas to a quality comparable<br />

to the reformed gas produced in a conventional<br />

MIDREX Plant and with use of DR-grade iron oxides,<br />

the DRI quality will be comparable to that from a<br />

natural gas-fired MIDREX Plant. This DRI can be<br />

discharged hot and melted in an EAF to produce<br />

high quality steels.<br />

Expected operating parameters for the combined<br />

Gasification/MIDREX complex in India are given in<br />

Table I.<br />

Table I<br />

Gasification/MIDREX Plant<br />

Operating Consumptions for Indian Conditions<br />

Basis: MIDREX MEGAMOD® with capacity of<br />

1,600,000 tpy of hot DRI 1 S-L FBDB Gasifier using<br />

typical high ash Indian coal<br />

Input Units Quantity per<br />

t hot DRI2<br />

Iron Ore t 1.45<br />

Coal (dry ash-free basis)* t 0.46<br />

Coal (as-received basis)* t 0.84<br />

H.P. steam t 0.7<br />

L.P. steam t 0.1<br />

Oxygen t 0.21<br />

Electricity kWh 180<br />

Maintenance & indirect costs3 USD 10.00<br />

1. The hot DRI product characteristics are: 93%<br />

metallization, 2% carbon, and 700º C discharge<br />

temperature<br />

2. Quantities are for the combined Gasification<br />

Plant and MIDREX DR Plant<br />

3. Includes routine maintenance, long-term<br />

amortized cost for replacing. capital equipment,<br />

and indirect costs<br />

* Values assume typical Indian coal<br />

The advantages of the S-L FBDB Gasification/<br />

MIDREX option include:<br />

Uses well-proven MIDREX Shaft Furnace<br />

Technology: 36 Mt produced in 2006<br />

Ability to use low rank, high ash domestic coals<br />

and iron ores<br />

Produces DRI with quality comparable to natural<br />

gas-based MIDREX Plants<br />


S-L FBDB Gasification/MIDREX Plant can be<br />

paired with an EAF mill to produce high quality<br />

long or flat steel products<br />

Lower specific capital cost than blast furnace/<br />

BOF<br />

No coke, coke ovens, or sinter plant required<br />

Reduced air emissions: virtually no SOx or NOx<br />

compounds generated<br />

Ability to capture high purity CO2 for<br />

sequestering or injecting into oil and gas fields<br />

Much larger capacities than rotary kilns: up to 2<br />

Mtpy in a single module<br />

Better quality product than rotary kilns<br />

Midrex is now discussing the use of the S-L FBDB<br />

Gasifier/MIDREX combination with several Indian<br />

clients.<br />


Another possibility for iron production in India is rotary<br />

hearth furnace (RHF) technology. This includes the<br />

FASTMET and FASTMELT Processes. Developed<br />

by Midrex Technologies and its parent company<br />

Kobe Steel, Ltd., FASTMET uses a rotary hearth<br />

furnace to convert iron oxide fines and ferrous<br />

wastes into highly metallized DRI. Carbon in the form<br />

of coal or contained in the wastes is used as the<br />

reductant. Burners fired by natural gas or other<br />

hydrocarbons, plus combustion of volatiles, provide<br />

the heat required for the reactions. FASTMELT has<br />

the same flowsheet through the RHF and adds an<br />

electric ironmaking furnace (EIF®) to produce a high<br />

quality hot metal from hot FASTMET DRI. FASTMET<br />

and FASTMELT Plants can be built in capacities up<br />

to 500,000 tpy. A flowsheet is shown in Figure 4.<br />

The two technologies have different applications.<br />

FASTMET is primarily a means to recycle fine ironbearing<br />

materials such as blast furnace dusts and<br />

sludges, BOF dust, mill scale, and EAF baghouse<br />

dust. This greatly reduces the volume to be disposed<br />

of and produces a cost-effective iron product that<br />

can be melted in an electric arc furnace, BOF, or<br />

blast furnace. In the case of EAF dust, the zinc oxide<br />

recovered in the baghouse can be sold to a<br />

processor for production of metallic zinc. India has<br />

large volumes of steel mill wastes that could be<br />

effectively recycled in a FASTMET Plant. If there is<br />

not sufficient carbon contained in the wastes, a low<br />

volatile coal would be imported for use as the<br />

reductant.<br />

FASTMELT feeds iron ore fines and iron-bearing<br />

wastes and produces a blast furnacegrade hot<br />

metal. By controlling the DRI chemistry, the hot metal<br />

can be tailored to precisely match the desired<br />

chemistry for feeding to an EAF or BOF. FASTMELT<br />

hot metal can also be cast into pigs for sale or later<br />

use. India has several possibilities for iron ore feed,<br />

including screenings from pellet plants and other<br />

facilities, and blue dust. FASTMELT requires use of<br />

a low volatile, low ash coal that would most likely be<br />

imported.<br />

Figure 4<br />

FASTMELT Flowsheet<br />

The rotary hearth furnace used for FASTMET and<br />

FASTMELT has been well proven in operation since<br />

2000 at a significant scale. There are three<br />

FASTMET Plants operating in Japan, two of which<br />

feed over 200,000 tons per year of steel mill wastes.<br />

One of these plants is shown in Figure 5.<br />


Figure 5<br />

FASTMET Plant at Nippon Steel<br />

Hirohata Works (1 of 2)<br />

Expected operating parameters for FASTMET and<br />

FASTMELT Plants in India are given in Table II.<br />

Table II<br />


Operating Consumptions for Indian Conditions<br />

Basis: Production rate of 500,000 tpy<br />

Quantity per t of product<br />


Input Units DRI hot metal3<br />

Iron Ore1 t 1.4 1.4<br />

Coal2 t 0.4 0.4<br />

Lime (binder) kg 60 60<br />

Flux t - 0.04<br />

Burner fuel net Gcal 0.7 0.7<br />

Electricity kWh 100 575<br />

Labor man-hour 0.2 0.35<br />

Maintenance USD 5.00 10.00<br />

1. Assumes DR-grade iron oxide; consumption of<br />

wastes with lower iron content would be<br />

proportionally higher<br />

2. <strong>May</strong> be lower if wastes are used that contain<br />

carbon<br />

3. Quantities for FASTMELT include RHF and EIF<br />

The advantages of FASTMET and FASTMELT<br />

include:<br />

Uses well-proven RHF Technology<br />

Ability to use domestic iron ore fines and ironbearing<br />

wastes<br />

Uses fine, non-coking coals; carbon–containing<br />

wastes reduce coal required<br />

Larger capacities than rotary kilns: up to<br />

500,000 tpy in a single module<br />

FASTMET DRI can be melted in an EAF or BOF<br />

FASTMELT produces a high quality hot metal<br />

Midrex and Kobe Steel are now discussing FASTMET<br />

and FASTMELT plants with a number of prospective<br />

clients around the world. Potential applications are<br />

regional treatment facilities, which would receive<br />

wastes from local steel mills, and use at a mine site<br />

to treat stockpiled mine tailings.<br />

Conclusion<br />

Indian steel production will need to continue to grow<br />

to supply the country’s rapidly expanding economy,<br />

utilising the country’s indigenous wealth of iron ore<br />

and coal. The blast furnace/BOF steelmaking route<br />

will continue to play a role, but it has limitations, such<br />

as the need to import expensive coking coal, the<br />

higher capital cost, and environmental issues. Direct<br />

reduction will continue to grow, but there are<br />

limitations with respect to the current approaches.<br />

Rotary kilns are small-scale and produce a lower<br />

quality DRI. The availability of natural gas to feed<br />

the larger capacity shaft furnace DR plants, is limited.<br />

Two new approaches that can make use of Indian<br />

resources are Gasification/MIDREX and the rotary<br />

hearth technologies FASTMET and FASTMELT. Coal<br />

gasification using the S-L FBDB Gasification Process<br />

and the MIDREX Shaft Furnace are individually wellproven<br />

worldwide and if combined, can provide an<br />

economical way to make high quality steels using<br />

Indian iron ores and coals. FASTMET on the other<br />

hand, provides the opportunity to recycle ironbearing<br />

wastes and solve an environmental problem.<br />

FASTMELT can utilize Indian iron ore fines to<br />

produce a blast furnace-grade hot metal.<br />


The DRI System<br />



The production of steel through Directly Reduced<br />

Iron (referred as DRI) route involves production of<br />

sponge iron and subsequently steel billets through<br />

electrical arc / induction furnaces.<br />

Sized coal, iron ore and dolomite are the main raw<br />

materials used for producing sponge iron. These<br />

materials, in predetermined quantities, are taken to<br />

B.L. AGRAWAL<br />



a common belt conveyor through weigh feeder to<br />

rotary kiln via feed tube.<br />

The following reactions take place in a coal based<br />

sponge iron rotary kiln :-<br />

3 Fe 0 + Co = .> 2 Fe + 04 + Co 2 3 3 2<br />

Fe 07 + Co = > 3 Fe0 + Co 2 2<br />

Fe0 + Co = > Fe + Co2 A typical process flow diagram of DRI System<br />

appears at the Exhibition – 1<br />


CDM potential of waste gases from the kiln<br />

The waste gases from the sponge iron kilns contain<br />

lot of combustibles, unused CO, carbon particles<br />

etc.<br />

A modern waste heat recovery system can extract<br />

substantial part of the waste heat from the flue gases<br />

emanating from the sponge iron kiln and utilize the<br />

same to produce steam, which in turn can generate<br />

power.<br />

A venture of this nature has the following attributes<br />

meeting the additionality requirements of a CDM<br />

Project:-<br />

a) it entails reduction in green house gas emission<br />

in relation to a conventional coal based power<br />

generation project.<br />

b) it ensures contribution to industrial energy<br />

efficiency and sustainable economic growth.<br />

c) it helps to improve the physical environment by<br />

cutting down thermal pollution.<br />

d) it conserves energy resources.<br />

e) it adopts clean technology by way of utilizing waste<br />

flue gases, and<br />

f) the main carbon benefits from this project arises<br />

from the replacement of an equivalent amount of<br />

electricity from the usual carbon intensive power grid.<br />

An assessment of CDM potential<br />

The present installed capacities of coal based<br />

sponge iron plants in India are as under :-<br />

TABLE – 1<br />

Range of<br />

installed capacity<br />

in tonnes per annum<br />

No. of units<br />

0 – 30,000 90<br />

30,000 – 60,000 47<br />

60,000 – 1,00,000 35<br />

1,00,000 – 2,50,000 40<br />

more than 2,50,000 15<br />

227<br />

While the small capacity plants may be constrained<br />

due to scale of economy to produce power through<br />

waste heat recovery system, the plants having<br />

capacity of 1.0 lakh tonne per annum and above<br />

i.e., those employing at least one kiln of 350 TPD<br />

can viably operate WHRB system.<br />

Presently, there are about 90 such plants whose<br />

CDM potential can be tapped. Out of this, as on<br />

20 th Mar’07, 13 plants have already gone CDM way<br />

and got registered with the CDM board of UNFCCC<br />

for carbon credit (Table-I). Out of these registered<br />

projects, in respect of four plants, CERs (Certified<br />

Emission Reduction) have also been issued (Table-<br />

II).<br />

Godawari Power And Ispat Limited has the unique<br />

distinction of being the first company globally in<br />

WHRB and Steel sector combined to register its CDM<br />

project and realise CERs. Further it is the only<br />

company so far to have registered two WHRB<br />

Projects.<br />

Details of WHRB Projects in Indian Sponge Iron Sector<br />

registered by CDM board as of 20th March’07<br />

(in chronological order starting from the first project registered)<br />

S.No. Date of Description of the Project Developer Estimated CER/ Year<br />

Registration Registered Project<br />

1 16 th Apr’06 Waste heat based Godawari Power 17,828<br />

7 MW Captive Power and Ispat Limited<br />

Project Godawari Power<br />

and Ispat Ltd (GPIL)<br />


2 12 <strong>May</strong>’06 TSIL – Waste Heat Tata Sponge and 31,762<br />

Recovery Based Power Iron Limited<br />

Project<br />

3 03 Jul’06 8MW Waste Heat OCL India 32,498<br />

Recover Based Captive Limited<br />

Power Project at OCL<br />

4 10 Jul’06 Waste heat recovery Monnet Ispat Ltd 1,18,383<br />

based captive power<br />

project at Monnet<br />

5 17 Jul’06 VGL – Waste Heat Vandana Global Limited 18,965<br />

based 4 MW Captive<br />

Power Project at Raipur<br />

6 17 Jul’06 JBSL – Waste Heat Jai Balaji Sponge Limited 46,387<br />

Recovery Based Captive<br />

Power Project<br />

7 08 Oct’06 Shri Bajrang WHR Shri Bajrang Power 1,07,683<br />

CDM Project and Ispat Limited<br />

8 09 Dec’06 Nakoda WHR Shree Nakoda 32,873<br />

CDM Project Ispat Limited<br />

9 15 Dec’06 OSIL – Waste Heat Orissa Sponge 41,052<br />

Recovery Based Captive Iron Limited<br />

Power Project<br />

10 17 Dec’06 “Waste heat recovery SKS Ispat Ltd. 1,16,773<br />

based captive power<br />

generation by SKS<br />

Ispat Limited”<br />

11 23 Dec’06 Usha Martin Limited – Usha Martin Limited 54,340<br />

Waste Heat Recovery<br />

Based Captive Power<br />

Project activity<br />

12 12 Feb’07 Waste Heat based 4.75 Rashmi Sponge<br />

MW captive power project Iron Pvt. Ltd. 23,887<br />

“RSIPL – WHRB (1&2) “<br />

CDM Project activity<br />

13 18 Feb’07 Waste Heat Based 10 MW Godawari Power and 50,620<br />

Captive Power Project Ispat Limited<br />

‘GPIL – WHRB 2 “CDM<br />

Project activity<br />

Total estimated CER/Year 6,93,051<br />


Table – II<br />

Details of CERs Issued in respect of Indian Companies<br />

in Sponge Iron Sector for WHRB Projects as of 20 th March 07<br />

Sl.No. Project Developer Date of CERs Issued Verified period<br />

Issuance<br />

1 Godawari Power and Ispat Limited 04 Aug 2006 66,536 01 Sep 2002 – 31 Dec 2005<br />

2 Monnet Ispat Limited 06 Sep 2006 1,11,570 01 Jan 2005 – 31 Mar 2006<br />

3 Tata Sponge Iron Limited 27 Dec 2006 1,06,463 01 Jan 2002 – 31 Mar 2006<br />

4 Shri Bajrang Power & Ispat Limited 22 Jan <strong>2007</strong> 74,674 01 Sep 2005 – 31 Aug 2006<br />

Total CERs Issued 3,59,243<br />

In the overall assessment, taking a production of<br />

six million tonnes of sponge iron during the year<br />

2006-07 through viable CDM projects, there is a<br />

potential of producing 420 MW power through WHRB<br />

with an annual carbon credit of 1.26 million CERs.<br />

Basis : (1) waste gases from a 350 tpd kiln can<br />

produce 7 MW power<br />

(2) 1 MW power on an average can attract 3000<br />

CERs annually<br />

By the year 2011 – 12, with the anticipated doubling<br />

of production of sponge iron in India, the power<br />

generation and corresponding CERs would also be<br />

doubled to realize a credit of 2.52 million CERs<br />

annually.<br />

How to Improve viability of WHRB Systems<br />

The viability of the waste heat recovery system, in<br />

general, can be enhanced, if the following are<br />

considered :-<br />

(i) permitting open access and inter-state wheeling<br />

of power from sponge iron sector at a reasonable<br />

tariff without any stricture from the State<br />

Governments. A waste heat recovery system based<br />

on 350 TPD kiln can generate about 7 MW, out of<br />

“When everyone tries, the team flies.”<br />

which 1.5 MW can be used for captive consumption<br />

in sponge iron making and a surplus of 5.5 MW can<br />

be wheeled to the grid.<br />

(ii) reserving and making available non-coking coal<br />

of high ash fusion temperature and high reactivity<br />

for sponge iron sector.<br />

(iii) allocating iron ore mines to sponge iron<br />

manufacturers, and<br />

(iv) extending carbon credit to the manufacture of<br />

fly ash bricks.<br />

Pre-heating of kilns - another CDM option in<br />

the arena of energy efficiency<br />

As an innovative step, it may be worth exploring<br />

installing rotary pre-heating section as an adjunct<br />

to sponge iron kilns, where the waste hot gases from<br />

the kilns can pre-heat the raw materials in the kilns<br />

in the vicinity of 750oC. This would reduce heat<br />

losses entailing lower coal consumption and<br />

enhanced production of sponge iron. While the<br />

gains are yet to be quantified through some plant<br />

trials, prima facie, it could attract CDM benefits owing<br />

to significant saving of fossil fuel. These projects<br />

can be viewed in the ambit of energy efficiency<br />

measures.<br />


The global steel industry is inching forward. An<br />

industry, which was characterized as Sunset industry<br />

two decades ago, is experiencing a vast change in<br />

scenario. World Crude steel production achieving a<br />

growth of 8.85% in 2006 over 2005. Major share<br />

coming from Asian continent, China and India being<br />

the major contributor achieved a substantial growth<br />

of 17.7% and 15.5% respectively.<br />

CRUDE STEEL PRODUCTION (million tones) &<br />

GROWTH RATE – (WORLD vis-à-vis INDIA)<br />


Can India expect any growth in the future in this Sector?<br />

PRAKASH TATIA-Vice President (Marketing) VIKRAM ISPAT, Bombay<br />

Average Per capita consumption of steel in world<br />

was around 189 Kgs in year 2005. However in India<br />

it was still 37.6 Kgs during the same year.<br />


From the above, It is noted that there is a huge<br />

untapped potential present in Indian market. Now<br />

the trend is changing from past couple of years, with<br />

consistent growth in Economy, huge investments<br />

coming from Domestic and International players in<br />

Infrastructure & development, Automobile sector,<br />

Industrial engineering, Oil & Gas sector thereby<br />

increasing the demand of steel in India. Hence, Steel<br />

Industry in India is entering a rapid growth phase.<br />

With such huge demand it is also expected<br />

production of steel would be triple by 2020 around<br />

110 MMT.Infact, now analysts are talking about more<br />

than 200MMT production by 2020. Growth in various<br />

sectors like Construction, Automobile & Engg is the<br />

main driving force behind such growth and with<br />

number of players increasing in each sector, Every<br />

player is looking to differentiate its product yet being<br />

cost competitive which is ultimately driving the<br />

demand for quality steel in the market. This demand<br />

for quality and various grades of steel by end users<br />

segments is forcing Steel manufacturers to opt for<br />

the best possible route for steel making.<br />


ROUTES<br />

Primary Route (CAGR of 3.9% (FY 94-06)<br />

Secondary Route (CAGR of 11.10% (FY 94-06)<br />

As per MIDREX Secondary Steel making process<br />

continues to grow because of its capital and<br />

operating cost advantage, flexibility for<br />

manufacturing various grades of steel, Relatively<br />

Environment friendly and Economies of scale. A large<br />

growth in world steel industry will be via Secondary<br />

route. This growth results in increased demand for<br />

metallic required for Secondary steel making route<br />

i.e. Scrap, DRI, HBI, and Pig Iron. However Since<br />

Scrap is not a manufactured commodity, there are<br />

limitations on growth in supply (especially Quality<br />

Scrap) and Pig iron having its limitation of usage in<br />

secondary route. Given these limitations, Sponge<br />

Iron (DRI/HBI) becomes the most preferred metallic<br />


in Secondary steel making process. The trend of<br />

past years showing growth in Sponge Iron Industry<br />

supports the above statement very strongly. World<br />

DRI production is 58.9MMT in CY- 06 thereby<br />

achieving a CAGR of 7% from (2001-06). India is<br />

the largest producer of Sponge iron for last 5<br />

consecutive years.<br />



IN FY 06-07 India would produce around 16MMT of<br />

Sponge iron (Gas based + Coal Based). Gas Based<br />

sponge iron being advantageous over Coal based<br />

sponge iron in terms of High Metallisation, Fecontent,<br />

Desired Carbon, and low Phosphorous &<br />

Sulphur and for manufacturing consistent quality of<br />

steel. It has become most preferred metallic for<br />

quality steel manufacturers sectors like Automobile,<br />

Oil & Gas, Construction & Eng etc .<br />

The growth of these sectors in time to come, is very<br />

promising (as shown below)<br />


So far the major constraint for the growth in Gas<br />

Based Sponge iron was low availability of Natural<br />

gas (critical raw material). As regards Iron oxides is<br />

concerned, our country is having abundant natural<br />

resources of Iron Ore. Now Scenario is changing in<br />

country with Proven gas reserves discovered by<br />

various major players in East/West coast of India,<br />

Gas Based Sponge iron industry stands favorable<br />

and has huge opportunity in the future to come.<br />

Since Gas being the most important ingredient for<br />

GB Sponge iron Industry its availability and Price<br />

have always been the key areas of concern for this<br />

Industry. In India Gas price is highest among the<br />

worldwide and in case of Infrastructure development<br />

there is huge disparity between Gas resources and<br />

demand centers leading to increase in<br />

transportation cost thereby leading to overall cost<br />

of GAS<br />

Looking at the overall growth in Steel Sector, with<br />

abundant natural resources of Iron Oxide and huge<br />

potential of availability of gas in India, if proper<br />

pricing policies and regulatory framework is designed<br />

mainly for Natural gas to attract and encourage<br />

investments in Infrastructure for supply of natural<br />

Gas, Gas Based Sponge Iron Industry has huge<br />

potential for growth in the country.<br />

“Happiness is when what you think, what you say, and what you do are in harmony.”<br />

Mahatma Gandhi<br />




Head International Trade & Business Development<br />

Essar Oil Limited Mumbai<br />

Natural gas has been rightly termed as the fuel of<br />

21 st century. Presently Natural gas, accounting for<br />

24 percent of total global primary energy supply, is<br />

the third largest contributor to the global energy<br />

basket and is projected to increase at an average<br />

rate of 2.4 percent per year from 2003 to 2030 as<br />

per EIA, which will be faster than any other energy<br />

source. During the last 5 year the global gas markets<br />

are fast integrating, commercial models are<br />

undergoing rapid changes, and market structures<br />

are evolving and fast changing. Leading this growth<br />

in global gas sector are the Asian markets with<br />

special investment focus on countries like China and<br />

India.<br />

With the advent of LNG and progressive de-control<br />

of gas prices, the natural gas sector in India has<br />

Hydrocarbon Reserve Position (Natural Gas)<br />

progressed and achieved some degree of maturity.<br />

Current natural gas policy dispensations have<br />

created numerous challenges for the gas sector.<br />

Major among them are the demands of competing<br />

consumers industries, ensuring competition and<br />

open access in the pipeline transportation and<br />

distribution networks, reducing the supply demand<br />

gap that exists today. The rapid growth of the Indian<br />

economy in the xth Plan (2002-<strong>2007</strong>) has greatly<br />

contributed to the development of the Indian energy<br />

sector as a whole and provided a major trigger for<br />

the growth of the gas sector as well. While gas<br />

occupies only about 9-10 percent of the total energy<br />

basket, primarily due to supply constraints all these<br />

years, the scenario is fast changing.<br />

As on 1.4.2006 the total prognosticated reserve, ultimate reserve and balance recoverable reserves of gas<br />

of the country have been estimated as under:<br />

Initial Place Ultimate Reserves Recoverable Reserves<br />

(MMT) (MMT) (MMT)<br />

ONGC 1688.32 942.28 523.01<br />

OIL 251.00 170.00 110.00<br />

Pvt/JV 933.59 511.76 466.94<br />

Total 2872.91 1624.04 1099.95<br />

Gas Infrastructure<br />

� On supply side, there are two LNG terminals at<br />

Dahej and Hazira in Gujarat with a total capacity<br />

of 7.5 MMTPA and are operating. The third<br />

terminal in Dabhol with a capacity of 5.0 MMTPA<br />

is likely to be commissioned shortly. There is plan<br />

for another terminal at Kochi and Mangalore<br />

which are taking a final shape for implementation.<br />

� In term of transmission pipelines, there is an<br />

existing network of 6300 km including the Hazira-<br />

Vijaipur-Jagdishpur pipeline and other regional<br />

networks. A number of pipelines, including those<br />

by the private sector are at various stage of<br />

implementation.<br />

� From coverage of just 2 cities at the beginning<br />

of Xth Plan (2002-07), the city gas coverage has<br />

grown to10 in 2005-06 across the western,<br />

northern and southern regions of the country.<br />

Currently there is a total city gas distribution<br />

network of about 6000 km. As far as CNG<br />

supplies are concerned, there are 278 stations<br />

dispensing CNG in the country and number is<br />

expected to continuously grow in coming years.<br />


Pricing of Natural Gas<br />

� Under the Administrative Pricing Mechanism<br />

(APM) gas produced from nominated fields of<br />

ONGC and OIL was priced at Rs.2850 per 1000<br />

SCM uniformly to all customers except in North<br />

East, wherein the same was Rs. 1700 per 1000<br />

SCM<br />

� With effect from 1.7.2006 the price was revised<br />

to Rs.3200 per MCM and calorific value of 10000<br />

Kcal/cubic meter. It was also decided that all APM<br />

gas will be supplied to Power and Fertilizer sector<br />

Demand and Supply Gap Analysis for the period <strong>2007</strong>-08 to 2011-12<br />

i) Sector Wise Gas Demand Projections (<strong>2007</strong>-2012)<br />

consumer’s alongwith specific end users<br />

committed under Court orders and small<br />

consumers below 50000 SCMD. Other<br />

consumers will be supplied gas at market price<br />

subject to a ceiling of ex-Dahej R-LNG (regasified<br />

LNG) price of US$3.86/MMBTU for 2005-<br />

06.<br />

� Gas supplied by the JV/private sector, re-gasified<br />

LNG and new gas supplies by ONGC and OIL<br />

will be charged as per the market price<br />

determined by various agreements applicable<br />

in this regard.<br />

MMSCMD)<br />

SECTOR <strong>2007</strong>-08 2008-09 2009-10 2010-11 2011-12<br />

Power 79.70 91.20 102.70 114.20 126.57<br />

Fertilizer 40.82 42.65 52.24 79.36 79.36<br />

City Gas 12.08 12.93 13.83 14.80 15.83<br />

Industrial<br />

Petrochemicals /<br />

Refineries/Internal<br />

15.00 16.05 17.17 18.38 19.66<br />

Consumption 25.37 27.15 29.05 31.08 33.25<br />

Sponge Iron / Steel 6.00 6.42 6.87 7.35 7.86<br />

Total 178.97 196.39 221.86 265.16 282.55<br />

(ii) Gas supply Projections (MMSCMD)<br />

Sources <strong>2007</strong>-08 2008-09 2009-10 2010-11 2011-12<br />

ONGC + Oil (A) 57.28 58.42 55.69 54.67 51.08<br />

Pvt./JVs (As per DGH) (B)<br />

Projected Domestic<br />

23.26 61.56 60.28 58.42 57.22<br />

Supply (A+B) 80.54 119.98 115.97 113.09 108.30<br />

(iii) LNG Supply Projections (MMPTA)<br />

LNG Supply Source <strong>2007</strong>-08 2008-09 2009-10 2010-11 2011-12<br />

Dahej 5.00 5.00 7.5 10.00 10.00<br />

Hazira 2.50 2.50 2.50 2.50 2.50<br />

Dabhol 1.20 2.10 5.00 5.00 5.00<br />

Kochi - - - 2.50 5.00<br />

Mangalore - - - - 1.25<br />

Total LNG Supply (MMTPA) 8.70 9.60 15.00 20.00 23.75<br />

Total LNG Supply (MMSCMD) 30.45 33.60 52.50 70.00 83.12<br />


iv) Overall Demand- Supply Gap (MMSCMD)<br />

<strong>2007</strong>-08 2008-09 2009-10 2010-11 2011-12<br />

SUPPLY<br />

Domestic 80.54 119.98 115.97 113.09 108.30<br />

LNG 30.45 33.60 52.50 70.00 83.12<br />

TOTAL:<br />

DEMAND<br />

110.99 153.58 168.47 183.09 191.42<br />

Demand 178.97 196.39 221.86 265.16 282.55<br />

GAP 67.98 42.81 53.39 82.07 91.13<br />

� It will be observed that scenario indicated above<br />

reflects significant deficit which will have to be met<br />

either from increased domestic supplies or LNG<br />

import or both.<br />

� There is another scenario where there is a possible<br />

additional domestic supply for 2009-10 (74<br />

MMSCMD), 2010-11 (84 MMSCMD) and 2011-12 (94<br />

MMSCMD). If such supplies materialize than from<br />

2009-10 onwards there will not be any deficit but<br />

there will be little surplus. These additional quantities<br />

have been estimated by DGH as 20, 30 and 40<br />

MMSCMD from Reliance fields from 2009-10, 2010-<br />

11 and 2011-12 respectively. 54 MMSCMD has been<br />

estimated from GSPC in each of above years.<br />

� How much of these additional supplies, which<br />

turn the deficit into surplus, will actually fructify<br />

is dependent on several factors yet to be firmed<br />

up.<br />

Conclusion<br />

India currently produces 90 MMSCMD of Gas against<br />

the demand of over 151 MMSCMD. For many years India<br />

continues to be deficit in supply of natural gas as the<br />

availability has been limited and therefore Government<br />

had adopted the system of allocations and administered<br />

price mechanism. With the new developments like import<br />

of LNG and new finds of domestic gas in KG basin the<br />

availability of natural gas / LNG is expected to go up<br />

significantly while at the same time the existing sources<br />

of supply from Bombay High etc. which are depleting will<br />

affect overall availability. The significant new finds from<br />

KG Basin yet to be monetized as the development work<br />

at wells continues and pipeline infrastructure to bring the<br />

gas on land is taking shape. The supplies from KG Basin<br />

are expected from Reliance, ONGC, GSPC and British<br />

Gas. Out of these players Reliance is expected to begin<br />

supplies sometimes in 2 nd quarter of 2008, and if everything<br />

goes well then the quantum of supplies that is expected<br />

will be around 40 MMSCMD. Though Reliance have<br />

claimed that they can supply upto 80 MMSCMD but the<br />

same has not been confirmed by DGH. The certified<br />

reserves for Reliance by Gaffiney, Cline and Associates<br />

have put recoverable reserves at 11.3 TCF. This would<br />

confirm supplies only upto 40 MMSCMD. Future factors<br />

which will drive demand and prices would be dependant<br />

upon (i) KG Basin supplies (ii) Long term LNG availability.<br />

Current estimate indicate potential demand of around 20<br />

MMSCMD for City Gas Distribution (CGD) along the<br />

existing pipeline routes. This demand is potentially<br />

favorable Vis-Vis alternate fuels. Spot LNG volumes in<br />

2006 are a landmark for Indian market. The regassifiers<br />

Petronet and Shell imported significant number of cargo’s<br />

to meet the demand from Power, Steel and Fertilizer<br />

sectors. The imports could have been more but for the<br />

restricted availability of spot cargo’s which were priced<br />

from $8 to $11 per MMBTU. It appears that in future also<br />

India would need to compete with more attractive<br />

markets. The challenge is to bring domestic gas to<br />

production and source LNG on long term basis. Gas<br />

markets would continue to be driven by existing<br />

customers in the medium term. Power and Fertilizer will<br />

be major sector consuming gas. LNG and new domestic<br />

discoveries will compete for the incremental demand. Gas<br />

will continue to be priced at a value “compared to alternate<br />

options” till the time there is ‘gas to gas’ competition in<br />

the market with significantly large volumes from domestic<br />

sources. Competitive claims of other consumers both in<br />

public and private sector may lead to some kind of<br />

allocation by Government for Power and Fertilizer sector.<br />

No clarity at present of additional supplies claimed by<br />

Reliance and GSPC. Reserve certification and DGH<br />

approval yet to happen. Producers from KG Basin may<br />

manage production to keep prices in the vicinity of<br />

international price. In view of overall deficit our additional<br />

requirements may not be fully met from domestic sources.<br />



Mr. Amitabh S. Mudgal (Vice President – Corporate Affairs & Marketing)<br />

We at Monnet Ispat & Energy Ltd. share the nation’s<br />

Vision for growth at a pace which was never ever<br />

though of before i.e. @ more than 10%. Pegging<br />

the growth driver at Manufacturing we ourselves<br />

have grown 8 times during the last decade.<br />

We identified newer technologies, we formed JV/<br />

alliance with the leading companies of the globe and<br />

today have emerged as a company globalizing to<br />

attain sustainable development. These facts are well<br />

authenticated our recent venture for coal abroad,<br />

by operating the largest underground coal mines in<br />

India and commission the much awaited BOO Coal<br />

Washery in NK Area.<br />

We at MIEL strongly advocate the fact that Coal is<br />

the back-bone of our economy. Coal not only in India<br />

but has been one of the world’s main energy<br />

resources for decade together and has emerged<br />

as an undisputed leader in the Energy scenario<br />

world wide, more so in India where 70% of<br />

Commercial Energy is generated from Coal. The<br />

Balance is taken care by Hydrel, Nuclear,<br />

unconventional source of Energy and fossel fuel.<br />

The vision of 2030 in India indicates multiple increase<br />

in demand for coal, though environment concerns<br />

shall have to be addressed to, for effective use of<br />

coal. The tentative projections for Coal demands<br />

for the terminal years of XI plan (2011-12) and XII<br />

plan (2016-17) are 620MT and 780MT respectively.<br />

In the demand scenario power sector plays the major<br />

role. Some non-coking coal is also used in sponge<br />

iron manufacture, Cement & other allied Industries.<br />

Both the production and distribution cum<br />

transportation are challenges to the coal industry at<br />

large. Quality of Indian Coal reserves both for coking<br />

and non-coking coal (Thermal coal) is also a big<br />

concern.<br />

As per survey conducted by Geological Survey of<br />

India (GSI) the total coal reserves are 234 billion<br />

tonnes. 86% of these reserves are Thermal Coal<br />

(Non-Coking) and 13.6% as coking coals & balance<br />

the high sulphur tertiary coal. The ash of both coking<br />

& non coking reserves in general is high compared<br />

to demand of Consumers. Dependence of the Power<br />

Sector ‘Inferior’ quality Indian Coal has been<br />

associated with emission from the power plant of<br />

particulate matter, toxic elements, No x , Co 2 and fly<br />

ash. In addition large volumes of the water are<br />

needed for cooling. There is also vast requirement<br />

of land for ash disposal.<br />

Since India can not live without coal, one of the<br />

solution is to adop clean coal technologies both at<br />

the power plant end and coal source. Monnet<br />

identified and allied with a US based company to<br />

bag the first contract to set up a BOO washery for<br />

any State Electricity Board.<br />

At power plant end, Technologies like Circulating or<br />

Pressurized Fluidized Bed Combustion (FBC), Super<br />

Critical Boilers and Integrated Gassification<br />

Combined Cycle (IGC), Super Critical Boilers and<br />

Integrated Gassification Combined Cycle (IGCC)<br />

would not only mitigate the pollution problems<br />

associated with coal combustion, but also have<br />

higher thermodynamic efficiency. These<br />

technologies are very suitable for country like India.<br />

Coal beneficiation is the most sought after method<br />

to reduce the inherant high ash in Raw Coal. Major<br />

public sector under taking CIL(Coal India Ltd.) has<br />

ambitious plans to meet the demand of coal & its<br />

beneficiation, but realising the magnitude of the<br />

problem, doors have been opened to private sector<br />

and import of coal has also been allowed from foreign<br />

countries by the Govt. of India. Incentives for import<br />

of Coal has been announced by Govt. Reducing of<br />

import duty on Coal to zero by Govt. is a major step<br />

in this direction.<br />

In private sector Monnet Ispat & Energy, Calcutta<br />

Electricity Supply Company, Bengal EMTA ,Jindal<br />

Iron & Steel, PANEM, BLA and HINDALCO. have<br />

stepped in for production of Non-Coking Coal for<br />

their Sponge Iron Plants as well as for Power Plants.<br />

MoC, Govt. of India has also allotted Coal Blocks to<br />

Power producing public sector companies like NTPC<br />

and other State Electricity Boards besides the private<br />

companies, thus widening the production base of<br />

coal. The transportation capacity of Country to<br />


transport this huge quantity of coal also need to be<br />

looked into.<br />

The Ministry of Environment and Forest has come<br />

in to raise the environmental concerns caused by<br />

transportation of the high ash coal to power plant<br />

across the country which are main cause of<br />

environment hazards down under. MOEF (Ministry<br />

of Environment and Forest) Govt. of India has put<br />

an embargo against use of unwashed non-coking<br />

coal for power generation except in pit head power<br />

plants. This embargo has indirectly addressed to<br />

transportation problem of this high ash coal as on<br />

average 20% of unwashed coal moved across the<br />

country for power generation is ash which is useless<br />

to power plants and infact source of other operational<br />

problem to them. If coal is washed at source this<br />

Quantity shall not have to be transported, thus<br />

effective adherence to MoEF directive will save<br />

transportation of the 20% undesired element of coal<br />

and in directly add to the transportation capacity of<br />

Railways. Which can be utilised to transport more<br />

washed coal and other essential goods.<br />

The washing of this huge quantity of Non-Coking<br />

Coal is itself a challenge, more so when CIL is not<br />

fully equipped with required washing capacity as<br />

present.<br />

Preparations are afoot in CIL/PSU’s Electricity<br />

Boards to take the help of Private Sector in Washing<br />

the Non-Coking Coal on “BOO CONCEPT”. Monnet<br />

Group has accepted this challenge and has<br />

established a new Company with American<br />

Collaboration called “Monnet Daniels Coal Washeries<br />

Pvt. Ltd.”, which is in process of installing a 3.5 MT<br />

capacity Washery at NK area of CCL near Ranchi<br />

under “BOO CONCEPT’ for Punjab Electricity Board.<br />

The Washery is expected to be commissioned by<br />

June ’07. Raw Coal will be supplied to this State of<br />

art Washery by CCL (CIL) where it will be beneficiated<br />

and despatched to Punjab Electricity Board for<br />

Power Generation in their Power Plants in Northern<br />

India. This Washery will beneficiate Coal with the<br />

help of Daniels Heavy Media bath, imported from<br />

USA and also use Belt Filter Press for recovery of<br />

Coal Fines. The Belt Filter Press is a State of art<br />

equipment imported from UK. These equipments<br />

alongwith other equipments will enable Washery to<br />

attain sharp separation of coal and help Washery to<br />

become economically viable besides helping in coal<br />

conservation. The erection & commissioning of this<br />

Washery is being completed in a record time of 8-9<br />

months.<br />

MDCWL is also planning to install 2.0 MT Merchant<br />

Washery near Bachra (Piparwar), Jharkhand in CCL<br />

command area, and a 5 MT Washery for their<br />

upcoming Power Plant at Angul (Orissa). Both these<br />

Washeries are expected to become operational<br />

within next two years. Apart from these two a cople<br />

of state of the art captive washeries are also on anvil<br />

in the state of Orissa and Raigarh.<br />

We at Monnet have always been acknowledged for<br />

introducing safety and cleaner environment. Our<br />

efforts have been appreciated by DGMS awarding<br />

us with the awards of safety for two consecutive years<br />

and UNFCCC by registering our project under clean<br />

development Mechanism.<br />

Ushering prosperity, development by implementing<br />

our project we are not only anchoring India in the<br />

growth trajectory but also fueling it to merge as one<br />

of the most developed nation of the country.<br />

“Everything has beauty, but not everyone sees it.”<br />

Confucius<br />



“THE ARAB STEEL SUMMIT <strong>2007</strong>” ON 12 TH TO 14 TH MARCH 07<br />

REPORT BY:<br />

Mr. Prakash Tatia Mr. Amitabh S. Mudgal<br />

Vice President (Mktg.) Vice President (Mktg.&Corp. Affairs)<br />

Vikram Ispat Monnet Ispat & Energy Ltd.<br />

The Arab Steel Summit held from 12th - 14th March,07, organized by the Arab Iron and Steel Union (AISU) in<br />

collaboration with Ministry of Commerce & Industry and Sharq (East) Sohar Co. More than 350 delegates<br />

from around 45 nations from various sectors attended the Summit, which is a huge response from all over the<br />

world.<br />

During conference various topics related to Iron and Steel industry were covered like Steel Market Potential in<br />

Middle East, Indian Sponge Iron Industry future prospects, World steel industry forecast by IISI, various players<br />

in Middle East and their expansion plans, upcoming technologies in steel sector etc. We keep on reading a lot<br />

about steel growth in China and India, however it seems that the Gulf who is also buzzing with steel activity<br />

has not been given due attention. The entire Gulf is experiencing a big construction boom which is resulting<br />

into a heavy demand for Steel particularly the long products. As any developing economy under going a<br />

construction / infrastructural boom will ultimately also have more demand for flat, the same is also going to<br />

happen in Gulf.<br />

<strong>SIMA</strong> delegation consisting of 12 members representing<br />

both (Gas based & Coal based) Sponge Iron sectors<br />

visited Muscat – Sultanate of Oman to attend this<br />

important Arab Steel Summit.<br />

Looking at the future growth emerging in Middle East<br />

and Asian region for Steel industry visit of our delegation<br />

was very useful. It helped in understanding the latest<br />

technological development in steel industry, demand<br />

supply scenario of different continents, future scenario<br />

of various metallic. Apart from sharing information such<br />

events help to develop the platform for networking also.<br />

Looking at Indian Iron & Steel industry growth<br />

perspective, such kind of visits on regular basis in<br />

different parts of world is quite useful. Such visits give<br />

a support to the related industries like our Sponge Iron and its growth in future.<br />

Mr. Amitabh S Mudgal of MIEL on behalf of <strong>SIMA</strong> presented a paper titled “ Future Prospects of Indian Sponge<br />

Iron Industry”. The paper was a window for all delegates to have a glance at the booming Sponge Iron<br />

Industry of India. The paper was not only appreciated by all delegates but also highlighted the opportunities<br />

which India provides for setting up Sponge from Industry in India. Mr. Tatia of M/s. Vikram Ispat is one of the<br />

Question/Answer session invited BHP and other miners to set up pelletization plant in India.<br />

The Arab Steel Summit <strong>2007</strong> program started from 12th and concluded on 14th March. The Organizers have<br />

also presented memento to <strong>SIMA</strong> delegation. On behalf of <strong>SIMA</strong> our Executive Director, Mr. S.S. Bhatnagar<br />

received memento from Arab Iron & Steel Union. On behalf of <strong>SIMA</strong> Mr. Bhatnagar also invited AISU to visit<br />

India to attend Annual General Meeting of <strong>SIMA</strong>.<br />

All members of delegation are thankful to <strong>SIMA</strong> for arranging this purposeful and very fruitful visit to Arab<br />

Steel Summit in OMAN.<br />


<strong>SIMA</strong> delegation at Arab Steel Summit <strong>2007</strong> organised by<br />

Arab Iron & Steel Union on 12-14 March <strong>2007</strong> at Muscat<br />

<strong>SIMA</strong> Executive Director Mr. S.S. Bhatnagar presenting souvenir to<br />

Mr. Mohamed Saleh Al-Jabr, Chairman Arab Iron & Steel Union during<br />

the Arab Steel Summit <strong>2007</strong>.<br />

<strong>SIMA</strong> delegation at Midrex Stall.<br />

<strong>SIMA</strong> Executive Director receives souvenir from the Chairman, Arab<br />

Iron & Steel Union.<br />

Mr. Amitabh S. Mudgal, Vice President, Monnet Ispat & Energy Ltd.<br />

making a presentation during Arab Steel Summit <strong>2007</strong> at Muscat.<br />

<strong>SIMA</strong> delegation in duscussions. <strong>SIMA</strong> Executive Director with Mr. Younes Haidar, Regional Director,<br />

Arab Iron & Steel Union and Mr. George N. Matta, Marketing Director,<br />

EZDK, Egypt.<br />





Back Ground:<br />

The industry was an early starter in the State. Barring<br />

the semi commercial unit of Sponge Iron India Ltd.<br />

established in 1980, commercial production in the<br />

country started with the plant established in 1984<br />

by Orissa Sponge Iron Ltd, which was quickly<br />

followed by Tata Sponge Iron Ltd. in 1986. Since the<br />

liberalization of steel sector Sponge Iron Industry<br />

attracted investment by small medium entrepreneurs.<br />

The State Industrial Policy of 1992, 1996 and 2001<br />

gave importance to the industry by placing it in<br />

favoured thrust area. The industries grew steadily.<br />

2 plants were established in 80s, which rose to 7<br />

plants in 90s. Since year 2000, 82 plants came into<br />

operation while 27 plants are in various stages of<br />

construction.<br />

These are all coal based sponge plants of varying<br />

kiln sizes and capacities. Smallest group of kilns (25<br />

to 50 TPD) are 54 in operation and 7 under<br />

construction. It is worthwhile mentioning that 13<br />

plants are having single such kiln of which 9 are<br />

operating and 4 in progress. As the economics of<br />

the single small plants is not encouraging, they are<br />

planning to upgrade their capacity by adding<br />

additional kilns.<br />

Gouri Shankar Agarwal,Chairman,<br />

Orissa Sponge Iron Manufacturers Association<br />

The most prevalent kiln size is 100 TPD. Among the<br />

operating plants, there are 103 kilns of the size and<br />

7 are being added. Besides there are 23 kilns under<br />

construction in new plants. Out of this single kilns<br />

are operating in 18 plants while 3 kilns are under<br />

expansion of the operating units. Besides 5 new<br />

plants are having single kiln under construction. The<br />

operational economics warrant upgrading of these<br />

single kiln units to at least 200 TPD capacity.<br />

Of the large size kilns of 300 to 500 TPD capacity<br />

there are 14 kilns in operation while 2 operating<br />

plants are expanding by 1 kiln each. Besides there<br />

are 13 plants of this size under construction and<br />

one of them proposes future expansion by one<br />

additional kiln.<br />

Capacity:<br />

The cumulative installed capacity of 82 operating<br />

plants is 5.272 Million Tonnes. The combined<br />

capacity addition on completion of 27 plants under<br />

construction will be 2.22 Million Tonne. The ultimate<br />

capacity of all plants will be approximately 7.492 (say<br />

7.5) Million Tonne per annum.<br />

Production:<br />

The production in the operating units are as follows:<br />

· 2003-04 and 2004-05, yearly : 1.925 MT/Year<br />

· During 2005-06 the production increased to : 2.26 MT.<br />

· The Capacity utilization of the Operating plants is : 57.11%<br />

The low level of production is mainly due to non-availability of Coal and Iron Ore of suitable quality.<br />

Investment:<br />

The investment for the Sponge industries is Rs. 3359<br />

Crores. All the industries shall have to establish<br />

WHRB based power units for which additional<br />

investment of Rs. 2268 Crores is required. It is<br />

estimated that cumulatively 567 MW power will be<br />

generated by the plants, which will be fully utilized in<br />

converting sponge to steel after meeting power<br />

consumption in sponge making.<br />

Employment:<br />

The employment potential of the industry is assessed<br />

at 18557 direct and 19228 indirect, totaling 37785.<br />

Land:<br />

The land occupation by these industries is 2998<br />

Acres or 1199.2 Hectares. Besides land will be<br />

required for solid waste disposal yards and<br />

plantation.<br />

Water Supply:<br />

The industry will require 900MLD (Million Liters per<br />

Day), which is not fully met from ground water and<br />

surface sources as available in the locality.<br />

Projects for bulk industrial water supply in all the<br />

clusters need to be speedily executed by tapping<br />

surface flow and underground sources.<br />


Power Grid:<br />

Similarly the power transmission system is to be<br />

strengthened to cater quality power as well as to<br />

facilitate evacuation of power from the captive<br />

WHRB-FBC cogeneration units.<br />

Iron Ore Requirement:<br />

Iron ore requirement, is of the order of 15 MTPA of<br />

high grade. The state has Iron ore reserved of 5671<br />

MTPA out of which high grade (Sponge grade) is<br />

2425 MT. This includes 3045 MT under captive mines<br />

1837 MT under non-captive mines and 1243 MT in<br />

virgin deposits. The state produced 54.6 % MT in<br />

2005-06 from 107 working mines. The ores were<br />

fed to domestic as well as export market. It is<br />

disappointing that the sponge industries are suffering<br />

from non-availability of Iron Ore. Besides the price<br />

escalation during the last 4 years has been hitting<br />

hard. Most of the sponge plants do not have captive<br />

mines.<br />

Coal Requirement:<br />

The coal requirement of the industries in state is<br />

about 12 MTPA of high grade, non-coking coal with<br />

ash content of 25% or less. Coal available to the<br />

plants by linkage is almost wholly of ‘F’ grade. It<br />

needs to resort to washing for which 24 MTPA coal<br />

will be required. Orissa has reserves of 62 Billion<br />

Tonne of non-coking coal largely of lower grade.<br />

Linkage have not been made for all the operating<br />

plants as yet.<br />

Development:<br />

At present kilns are operated using lower grade Iron<br />

Ore and Coal as the standard quality materials are<br />

unobtainable as well as price constraints. It has<br />

therefore become necessary to preprocess Iron Ore<br />

and Coal at plant or at customized central units. It<br />

includes low-grade ore concentration, pelletisation<br />

and washing of coal. Operation and maintenance<br />

system needs improvement for maintaining quality<br />

and output efficiency. Although the kiln operation is<br />

semi mechanized there is scope of upgrading and<br />

integrating control systems. Waste utilization, safety<br />

measures, environmental cleanliness and pollution<br />

abatement are some of the important tasks, which<br />

will continue to engage attention of the entrepreneur.<br />

Cost Impacts:<br />

Apprehensions as to economic viability and long life<br />

of the industry has been bothering the entrepreneurs<br />

in absence of assured supply of raw materials of<br />

proper quality at affordable cost. Other operational<br />

cost impacts are on account of transport, inadequate<br />

infrastructure and service facilities. In a highly<br />

competitive environment and market instability the<br />

industry is adopting higher value addition through<br />

down stream process units for conversion to steel<br />

and rolled products. Co-generation with CDM benefit<br />

is attempted to cut down the power cost besides<br />

environmental gain.<br />

Transportation:<br />

The plants are spread over 9 districts and most of<br />

them are located within 10 clusters of 20 Kms. radius<br />

each. Nearly 30% of the plants are within 25 Kms.<br />

radius of source of Iron Ore & Coal. 70% of the plants<br />

require to transport either ore or coal or both to<br />

distances of 100 to 200 Kms. As the connecting<br />

roads are presently in very bad shape, transport<br />

charges are exorbitantly high. Rail connectivity and<br />

rolling stock availability is poor for bulk movement<br />

of raw materials as well as the products. Therefore<br />

links and sidings handling system and improvement<br />

of the existing rail and road routes require to be<br />

undertaken within short span of time, if required<br />

under public, private partnership.<br />

Solid Waste Management:<br />

The solid waste generation at the sponge plants<br />

consists chiefly of coal char, which is about 15% to<br />

20%of raw feed by weight. Minor quantities of<br />

sludges are generated. The ash and dust collected<br />

from the pollution control systems and the power<br />

units need to be scientifically disposed off for which<br />

waste disposal yards are to be planned and<br />

managed. Waste recycling is also being tried.<br />

Contribution to Exchequer:<br />

The industry with its current authorized capacity has<br />

potentiality of contributing to Govt. Exchequers<br />

annually as follows:<br />

State Govt. : 651.87 Crore<br />

Central Govt. : 1678.5 Crore<br />

MOU Plants:<br />

The State Govt. has inked MOUs with 45 companies<br />

for establishing steel units in the state with capacities<br />

above 0.25 MTA. These units will have combined<br />

capacity of 81.4 MTA. Out of the above 31 plants<br />

shall be in sponge route, having total capacity of<br />

15.85 MTA Sponge Iron. These include 23 existing<br />

sponge manufacturers. Investments under these<br />

projects total Rs. 180440 Crore. Land and water<br />

requirement of the plants is 16157 Ha. and 3.3 BLD<br />

respectively. Their employment potential both direct<br />

& indirect is 28000.<br />




Suresh Thawani becomes the new Managing Director of Tata Sponge Iron Ltd.<br />

Mr.Suresh Thawani joins Tata Sponge as the Managing Director of<br />

the company with effect from 10th March <strong>2007</strong>. He replaces Mr.Ashok<br />

Pandit after the latter retired on completion of his term on 9th March<br />

<strong>2007</strong>.<br />

A Graduate in Metallurgical Engineering from IIT Kharagpur (1972<br />

batch), Mr Thawani started his career as a Graduate Trainee in<br />

Tata Steel in 1972. He has spent three decades in Tata Steel.<br />

Mr Thawani holds multifarious experience of working in Scientific<br />

Services Division, Sales and Marketing, Production Planning and<br />

Raw Material Commercial Division of Tata Steel. He was the Executive Director<br />

(Operations) of Standard Chrome Limited during 1995-96. Around 1997, he was deputed<br />

to Timken Company, USA and Luken Steel, USA to explore business opportunities for<br />

them in India and South East Asia. He worked as the CEO of Nilanchal Refractories<br />

Limited and thereafter served for three and a half years as the Managing Director at<br />

Jamshedpur Injection Powder Limited, a joint venture company promoted by Tata Steel,<br />

SKW Stahl Metallurgie AG, Germany and Tai Industries, Bhutan prior to assuming the<br />

Managing Directorship of Tata Sponge.<br />

Mr. N K Patnaik<br />

Mr. N K. Patnaik, Vice Chairman, <strong>SIMA</strong> joined Monnet Ispat & Energy<br />

Ltd. as Chief Executive Officer for Angul Project, Orissa w.e.f. March<br />

<strong>2007</strong>. On behalf of members Sponge Iron Manufacturers Association,<br />

we wish Mr. Patnaik all success in his new challenging assignment.<br />

S. K. Ghosh<br />

On behalf of the members of Sponge Iron Manucaturers Association,<br />

we convey our heartiest congratulations to Mr. S K Ghosh who has<br />

been redesignated as General Manger of Orissa Sponge Iron &<br />

Steel Ltd. w.e.f. 1st April <strong>2007</strong>. A well-earned and well-deserved<br />

promotion, we wish Mr. Ghosh all success in his new and responsible<br />

assignment<br />












VISAKHAPATNAM - 530 003<br />

PHONE 91 891 6667401-04 91 33 22809007 / 8<br />

FAX 91 891 2561447 91 33 22831618<br />





PHONE 91 8952 283225 RAIPUR (C.G)-492 006<br />

PHONE 91 771 4073258<br />

FAX 91 771 4073084<br />







One of the most important problems on the chemical<br />

content of the DRI product resulting from the direct<br />

reduction of ores is the level of sulfur in the DRI<br />

since severe process difficulties are posed to<br />

processors using such DRI for the making of steel<br />

by even small amounts of sulfur in their feed stock.<br />

Accordingly, a strict upper limit of 0.03% sulfur by<br />

weight in the DRI product should be achieved and<br />

preferably even lower sulfur levels would be<br />

desirable. To this end, a conventional practice in<br />

the process for directly reducing iron ores in a rotary<br />

kiln using coal fed at both the ore feed and discharge<br />

ends, is to add a sulfur control agent, such as<br />

limestone or dolomite, to the charge at the feed end<br />

of the kiln.<br />

The important factors in the process affecting the<br />

sulfur levels in the DRI and steps and means for<br />

properly controlling these factors<br />

(1) high temperatures in the kiln bed;<br />

(2) Low level of char in the kiln discharge materials;<br />

(3) Inadequate control of limestone or dolomite<br />

feeding;<br />

(4) Recycling of used limestone or dolomite in the<br />

char from the kiln discharge that is returned to<br />

the kiln;<br />

(5) The fines content of the ore feed;<br />

(6) the sulfur level in the feed coals;<br />

(7) the sulfur level in the ore feed;<br />

(8) inadequate control of the feed end bed and gas<br />

temperature profiles to promote oxidation of the<br />

sulfur in the feed end coal; and<br />

(9) contamination of the product pellets by char,<br />

grease or etc.<br />

(1) Kiln Bed Temperatures<br />

Mainly sulfur absorption problems occur in the bed<br />

over about the last one-third of the kiln length, and<br />

more specifically in the region where high residence<br />

times and the highest bed temperature.<br />

(2) Char Level in the Kiln Discharge Materials<br />

Closely regulating the ore, coal, and char feeding<br />

to the kiln to maintain the specified range of fixed<br />

carbon (5-15%) by weight in the total discharge<br />

materials from the discharge end of the kiln,<br />

contributes significantly to maintaining low levels of<br />

sulfur in the DRI.<br />

(3) Sulfur Control Agent Feeding<br />

Limestone or dolomite is added to the kiln feed as<br />

the control agent for sulfur removal, generally in the<br />

range from 1% to 5 % by weight of ore feed further<br />

important consideration is that the sizing of the<br />

particles of limestone or dolomite feed must be<br />

closely controlled to achieve incorporation of the<br />

control agent into the bed when feeding it with the<br />

ore through the feed end of the kiln. If the particles<br />

are too small, substantial losses of the control agent<br />

may occur in the exhaust gases passing out of the<br />

feed end, but, on the other hand, large limestone<br />

particles cannot effectively absorb the sulfur.<br />

Therefore, the control agent particles should<br />

preferably be of an intermediate size with respect to<br />

the other feeds, that is, such a size as 1-4 mm.<br />

(4) Recycling of Used Control Agent in the Return<br />

Char<br />

Limestone or dolomite that has passed through the<br />

kiln may have absorbed a relatively great amount of<br />

sulfur so that if it is re-fed to the kiln in the recycle<br />

char system, it can act as a sulfur source, thus slowly<br />

increasing the total sulfur load to the kiln.<br />

(5) Ore Feed Screening<br />

Analysis of the sponge iron or DRI particles has<br />

shown that any sulfur incorporated into the product<br />

is deposited on, or in close proximity to, the particle<br />

surface. Thus, to minimize sulfur content, the surface<br />


area of the DRI formed should be minimized. Since<br />

total surface area increases sharply with the fines<br />

content of the charge.<br />

(6) Feed Coal Sulfur Level<br />

As sulfur is introduced into the process by means of<br />

the feed end and blown coal, the sulfur level in the<br />

feed coals is an important consideration. Sulfur is<br />

present in the coal in inorganic form as pyritic sulfur<br />

or in organic or even sulfate form. Although the actual<br />

chemical form of the sulfur in the coal has been<br />

determined by experience to be not of great<br />

importance, still, regardless of its form, it poses a<br />

problem in the process and will, if not controlled,<br />

contaminate the DRI product. It follows that the higher<br />

the sulfur content of the coal the more effort is<br />

required to control that sulfur. As a result, regular<br />

analyses should be performed on the coals used in<br />

the process, and while the process may run<br />

acceptably with coals of up to 3% sulfur, it is<br />

preferred that coals with less than 2% be used.<br />

(7) Ore Feed Sulfur Level<br />

It has been found also that ore containing the iron<br />

oxide to be reduced in the process should have a<br />

less than 0.03% sulfur content or a weight percent<br />

of sulfur which is less than that desired in the DRI<br />

product.<br />

(8) Kiln Feed End Temperatures<br />

The oxidizing environment at the feed end of the<br />

kiln may be used to advantage in removing some of<br />

the sulfur from the kiln feeds. By operating at gas<br />

temperatures of greater than about 750.degree. C.<br />

in this region rapid “roasting” of the pyritic sulfur<br />

component in the feeds is promoted with the result<br />

that oxides of sulfur are rapidly formed and removed<br />

from the charge together with a proportion of the<br />

organic sulfur which is lost with volatile evolution.<br />

This high temperature operation substantially<br />

reduces the quantity of sulfur delivered to the high<br />

temperature reducing or “working” zone of the kiln<br />

where sulfur absorption into the product may occur.<br />

(9) Product Pellet Contamination<br />

“Tough times never last, tough people do.”<br />

Robert Schuller<br />

Contamination of the DRI pellet product by sulfurcontaining<br />

char, grease or the like, while one of the<br />

less complex factors affecting the product, may occur<br />

in a random manner so that it can be difficult to trace<br />

and eliminate. If either or both of these materials<br />

contaminates the product to any significant degree,<br />

unacceptably high sulfur levels can result. Detection<br />

of this contamination may be accomplished initially<br />

by visual inspection of the product on the separation<br />

section conveyor belts. If the grease condition is<br />

observed, the process should be stopped and any<br />

grease leakage into the cooler eliminated. The<br />

performance of the magnetic separators should be<br />

carefully monitored to avoid the return of any sulfur<br />

to the product stream, since if the magnetic field in<br />

a separator is too strong, it may draw DRIcontaminated<br />

char-containing sulfur into the product<br />

stream.<br />

Control and regulation of the above factors the direct<br />

reduction process may be continuously carried out<br />

with a resulting product having sulfur levels below<br />

desired level by weight in the DRI.<br />




The first industrial scale direct reduction plant back<br />

in the mid 1950’s was a success on a number of<br />

fronts for HYL. The purpose of providing a quality<br />

pure iron feedstock for electric furnace steel<br />

making was achieved, and step by step a growing<br />

use and acceptance developed for the product,<br />

which led to today’s burgeoning DRI industry<br />

worldwide.<br />

When the 1M Hylsa DR plant in Monterrey, Mexico<br />

was put into operation, the environment was not<br />

a major consideration. The 1950’s was an era of<br />

increased industrialization worldwide following<br />

WWII and little attention was paid at the time to<br />

the ecological effects of industrial growth. The<br />

plant consumed over 4 times the natural gas that<br />

today’s process requires, and since it was a batch<br />

process in open retorts, particulate matter and<br />

gaseous pollution were obvious side-effects of the<br />

technology.<br />

Fortunately, those days have long passed and<br />

today’s technology from Tenova HYL is green and<br />

streamlined. The process is now being marketed<br />

and developed jointly with Danieli & C. under the<br />

new Energiron trademark. Not only is the process<br />

itself the most environmentally friendly, but new<br />

collateral technologies such as the HYL HYTEMP<br />

System have made steel making more efficient<br />

and clean by transporting the DRI hot in a fully<br />

enclosed pneumatic system to modern electric<br />

furnaces. An added advantage of these<br />

technologies is that they are also more efficient<br />

and more cost-effective than ever.<br />

Reducing Gases<br />

In an Energiron plant the reducing gas is produced<br />

in two ways: in an external steam reformer, and/<br />

or directly in the shaft reactor by means of “in<br />

situ reforming” reactions.<br />

The ratio between reforming and “in situ<br />

reforming” can be varied to balance production<br />

Thomas Scarnati<br />

Manager- Marketing & Sales<br />

HYL Technologies, SA.De C.V, Mexico<br />

and investment costs exigencies. The Energiron<br />

scheme can be based on 100% external reforming<br />

to 100% “in-situ” reforming (ZR) or any<br />

combination (small reformer + oxygen injection).<br />

This is a unique characteristic of the Energiron<br />

process flexibility. The most adequate scheme will<br />

depend on the local cost structure of energy and<br />

raw materials. As an example, the scheme with<br />

external reformer consumes more gas, but the<br />

power is minimized, while the ZR scheme minimizes<br />

the natural gas consumption but requires more<br />

power (electricity + oxygen). Also, the product<br />

quality has to be considered: the scheme with<br />

100% external reforming produces DRI with up to<br />

2.4% carbon or up to 3.5% carbon if there is some<br />

oxygen injection, while the ZR produces DRI with<br />

= 4% carbon. The most adequate scheme must<br />

be selected based upon the production cost<br />

analysis up to liquid steel, to consider all factors.<br />

Potential Pollution Sources<br />

Direct reduction is based on the chemical<br />

conversion of iron oxides to metallic iron and iron<br />

carbide by the action of reducing and<br />

carburization agents. To accomplish this, different<br />

sources of reducing/carburization agents can be<br />

used, such as natural gas, coal, fuel oil, and coke<br />

oven gas. As with all industrial processes, there<br />

are wastes and by-products which must be dealt<br />

with.<br />

The potential sources of pollution in a DR plant<br />

can come from several distinct areas, which are<br />

carefully monitored. In recent years it has become<br />

critical for some technologies to incorporate the<br />

means for minimizing or eliminating pollutants in<br />

order for client companies to comply with strict<br />

environmental regulations. Polluting wastes from<br />

direct reduction plants, regardless of the<br />

technology used, can be mainly dust, SO x , NO x<br />

and suspended solids in water effluents.<br />


• Dust is generated during handling and<br />

transportation of iron ores, DRI, solid<br />

reducing agents and ash; the latter two<br />

only using alternate sources of reducing<br />

gases, other than natural gas. Typically,<br />

the material handling of an Energiron plant<br />

consists of the iron ore and product<br />

handling systems. These systems include<br />

bins, screening units, coating unit,<br />

conveyors, and transfer stations. Air<br />

pollution caused by dust is minimized by<br />

installing appropriate dust collectors in the<br />

main generation points, typically in trasfer<br />

locations and screening units.<br />

• Flue gases containing the polluting<br />

elements SO x and NO x , are derived from<br />

the combustion systems of the reducing<br />

gas generation units, gas heaters and<br />

rotary kilns. The amount of SO x and NO x<br />

can be decreased in gas based processes<br />

by an adequate control of combustion<br />

operations, and by desulfurization of the<br />

fuel gas stream to be used, both as<br />

process gas (reducing gas) and as fuel.<br />

The process chemistry of each technology<br />

will determine how difficult or how easy this<br />

control will be. In the case of the<br />

Energiron technology, SO x is selectively<br />

eliminated in the CO 2 absorption unit and<br />

NO x is easily controlled by low-NO x type<br />

burners, allowing compliance with even the<br />

strictest standards.<br />

• Suspended solids in the effluents from the<br />

water systems consist mainly of iron oxide<br />

and DRI particles, collected in the wet<br />

systems of the different sections of the<br />

plant. These solids can be dried and<br />

concentrated to be sold or reused as<br />

feedstock in the reduction units.<br />

Environmental Impact<br />

Emissions from Energiron plants are in<br />

accordance with the most stringent environmental<br />

regulations anywhere. This is achieved in large<br />

part due to the process design itself; while other<br />

processes require heat recovery equipment which<br />

tends to increase the NO x levels, the Energiron<br />

Process is efficient by design due to its process<br />

configuration and heat recovery systems.<br />

Depending on the type of plant, heat recovery<br />

systems consists of:<br />

• With external reformer - the efficiency is<br />

achieved by generation of steam, which is<br />

required for natural gas reforming and for<br />

CO 2 stripping. Prior to end-using, the steam<br />

is used in some steam turbines for power<br />

co-generation, reducing significantly<br />

electricity consumption.<br />

• With “in-situ” reforming, the steam required<br />

in CO 2 stripping is generated in the top gas<br />

heat recuperator.<br />

Thus, while achieving high overall thermal<br />

efficiency in the plant, there is no significant need<br />

for preheating the combustion air in the reformer<br />

or in the heater to high temperatures, thus<br />

eliminating the possibility of high NO x generation.<br />

For other DR processes, this is not the case and<br />

the choice between decreasing thermal efficiency<br />

or installing expensive de-NO x units remains.<br />

The tables summarize the environmental impact<br />

of Energiron plants, comprising solid wastes,<br />

emissions to the air and water, and noise. These<br />

levels comply with the strict standards imposed in<br />

such areas as the USA, Saudi Arabia, Malaysia<br />

and other nations with the most modern<br />

environmental standards, including new standards<br />

proposed but not yet enacted.<br />

Tenova HYL together with Danieli has been<br />

working on a project for a plant of 1.6 million tpy<br />

capacity being built for GHC in Abu Dhabi, where<br />

environmental controls are also among the<br />

strictest anywhere. Still, the values achieved are<br />

well within the requirements for compliance.<br />

Table I<br />

Solid Wastes (kg/ton DRI)<br />

Recycled Dumped Total<br />

• Dust collected 3.20 - 3.20<br />

• Iron oxide fines - 26.70 26.70<br />

• DRI cooling losses - 6.45 6.45<br />

• Others 0.25 0.35 0.60<br />


Table II<br />

Emissions to the Air<br />

Combustion System Dust Collection<br />

(mg/Nm 3 ) (ppmv) (mg/Nm 3 )<br />

• Particulates

additions and a decrease in electrodes<br />

consumption in the EAF.<br />

Environmentally, the enclosed system eliminates<br />

the release of DRI fines as waste and is in fact a<br />

double advantage in that the fines are introduced<br />

into the EAF along with the pelletized/lump DRI,<br />

thus increasing the overall yield. Using a<br />

continuous melting practice, the EAF roof is never<br />

opened, thus conserving the yield and avoiding<br />

loss of fines from charging or furnace blowoff.<br />

Since the HYTEMP System allows the transfer and<br />

use of reduced fines from the DR reactor to the<br />

EAF, a study over several years was conducted<br />

in-plant to try and determine the amount of solids<br />

carried over by the fumes extraction and dust<br />

collection system of the EAF shop.<br />

The monitoring is done at the Precipitation<br />

Chamber and at the Bag House by collecting and<br />

weighing the solids by-monthly. As evidenced in<br />

the figures, it was determined that there is no<br />

distinctive relationship between the amount of<br />

solids in either of the collection points and the %<br />

of DRI in the charge,nor the ratio of hot DRI used.<br />

This confirms that the HYTEMP System does<br />

not contribute to the loss of Fe units in the offgas<br />

of the furnace.<br />

Summary<br />



Registered : Survey No. 20<br />

Office & Works Kasan Kandi Road<br />

Village & P.O. Hire Baganal<br />

District Koppal 583 228<br />

Karnataka<br />

Phone : (08539) 264124-126<br />

Fax : (08539) 264122<br />

Email : admin@hkmetallics.com<br />

Annual Capacity : 0.75 Lakh Tons<br />

Contact Person : Mr. Sandeep Agarwal<br />

Managing Director<br />


Registered Office : 199C, (First Floor)<br />

Main Road<br />

Samta Colony<br />

Raipur (C.G)<br />

Phone : (0771) 4075263/265<br />

Fax : (0771) 4075263/264<br />

Email : mhil-ryp@hotmail.com<br />

Annual Capacity : 0.60 Lakh Tons<br />

Contact Persons : Mr. Ashok Kumar Agarwal<br />

Director<br />

Mr. Binod Kumar Agarwal<br />

Director<br />

As any industrial technology, the demand now is<br />

for better productivity while at the same time<br />

protecting the environment. Use of alternative<br />

fuel and reducing sources, more efficient process<br />

design and new technologies such as the<br />

HYTEMP System, have given Tenova HYL an edge<br />

in today’s strictly regulated iron and steel industry.<br />


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