Japanese steel maker Kobe Steel announced the launch of Kobenable Steel to become Japan’s first provider of low CO2 blast furnace steel products with significantly reduced CO2 emissions during the blast furnace iron making process. The Company plans to start selling the new products this fiscal year. Kobenable Steel is based on the KOBELCO Group's CO2 Reduction Solution for Blast Furnace Iron making. It utilizes a technology that can significantly reduce CO2 emissions from the blast furnace, which was demonstrated by charging into the blast furnace at the Company’s production site Kakogawa Works a large amount of HBI produced by the MIDREX Process

Kobe Steel plans to launch Kobenable Steel in two product categories

A. Kobenable Premier – 100% Reduction Rate of CO2 emissions per tonne as compared with conventional products

B. Kobenable Half - 50% Reduction Rate of CO2 emissions per tonne as compared with conventional products

Kobenable Steel, manufactured in the same process as the conventional blast furnace method, has the following two features.

1. Kobenable Steel is available for all types of steel products (steel sheet, steel plate, wire rod & bar products) manufactured at Kakogawa Works and the Kobe Wire Rod & Bar Plant.

2. Customers can continue to use blast furnace steel products that require high quality, such as special steel wire rods and ultra-high-tensile strength steel, which are the Company’s strengths.

For commercialization, reduction rates of CO2 emissions are calculated using the mass balance methodology in which CO2 reduction effects are allocated to specific steel products, in accordance with ISO 20915. The calculation method and results are certified by the DNV Business Assurance services UK Ltd, a third-party certification body in the UK. At the time of the sale of the products, Kobe Steel will provide the customer with a third-party certificate issued by DNV and a low-CO2 steel product certificate issued by the Company

Kobe Steel had successfully demonstrated CO2 Reduction Solution for Blast Furnace Iron making at a 4,844 cubic meters blast furnace of the Kakogawa Works in Hyogo Prefecture in Japan in October 2020. The quantity of CO2 emissions from the blast furnace is determined by the Reducing Agent Rate or the quantity of carbon fuel used in blast furnace iron making. In the demonstration test, it was verified that RAR could be stably reduced from 518 kg per tonne hot metal to 415 kg per tonne hot metal by charging a large amount of hot briquetted iron produced by the MIDREX Process. The results indicate that this technology can reduce CO2 emissions by approximately 20% compared to a conventional method. In addition, the world's lowest level of coke rate of 239 kg per tonne hot metal was achieved in the demonstration test of this technology.

CO2 reduction cost using this technology is calculated as follows

A. Quantity of HBI charged x HBI price

B. Quantity of iron ore reduced x iron ore price

C. Quantity of reduetant reduced x reduetant unit price EQUALS Quantity of coke reduced x coke price MINUS Quantity of pulverized coal x pulverized coal price

D. Quantity of CO2 reduced is the quantity of reduetant reduced x CO2 emission factor

CO2 reduction cost EQUALS {(A-B-C)/D} PLUS Equipment & Other costs

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