After about a year of preparation, Wolfgang Eder, CEO of voestalpine, broke ground today for the construction of a direct reduction plant in Texas (USA). The EUR 550M investment is the largest foreign investment in the history of the Austrian Group. The voestalpine Texas plant is being constructed at the La Quinta Trade Gateway Terminal in close proximity to the city of Corpus Christi. Starting in 2016, the plant will produce 2M tons of hot briquetted iron (HBI) and direct reduced iron (DRI) annually with sponge iron as a premium raw material. With the new facility, voestalpine can significantly reduce production costs in Europe.
The direct reduction plant will use iron ore pellets to produce high-quality DRI/HBI (sponge iron) comparable to the highest quality scrap or pig iron, which is an excellent primary material for the production of crude steel. In contrast to the coke- and coal-based pure blast furnace route, only natural gas is used as a reduction agent in direct reduction, which is more environmentally friendly. The price of natural gas in the U.S. is about a half of what it is in Europe. The plant will produce 2M tons of DRI/HBI annually, of which about half will be shipped by sea to the steel plants in Linz and Donawitz. The other half will be used as a strategic reserve and sold to long-term partners.
