Sber toFund Construction of Metalloinvest & USM HBI Plant in Kursk
Sber and Metalloinvest’s Andrey Varichev Mikhailovsky GOK & USM JV Mikhailovsky HBI have entered into a strategic cooperation agreement for the construction of a hot briquetted iron plant in the Kursk region. The document was signed during the St. Petersburg International Economic Forum. The bank intends to open a credit line of up to USD 620 million for Mikhailovsky HBI until 31 December 2034. It will also arrange for a documentary line to open letters of credit for settlements, a high-quality and high-tech banking service, and analytical and information support as part of the project.
Mikhailovsky HBI, 55% owned by USM & 45% by Mikhailovsky GOK, is currently building one of the world's largest and most advanced HBI plants in Kursk region. The plant will have a production capacity of over 2 million tonnes per year.The new plant is scheduled to be commissioned in the first half of 2024. Investments in the construction of the plant are estimated to exceed RUB 40 million.
The use of HBI is among the most promising development areas in the global steel industry. In terms of its composition, HBI is similar to pig iron and is used as an additive to scrap during steelmaking, but unlike scrap metal, it contains practically no impurities. HBI has over 90% iron content, has a constant chemical composition and a metallisation rate of over 93%. HBI is formed by direct reduction of iron in oxidised iron ore pellets. The pellets are fed into the furnace, where they undergo iron reduction reactions through a reducing gas consisting of a mixture of carbon oxide and hydrogen. When hot, the reduced pellets are fed to roller briquetting presses, where briquettes are formed under high pressure at a pressed material temperature of about 700°C.
Compared to iron production, the energy costs and greenhouse gas emissions associated with HBI production are about 50% lower.