BURNS HARBOR — Cleveland-Cliffs is planning major investments in hydrogen at its Northwest Indiana steel mills, betting big the new fuel stock for blast furnaces will lessen their carbon impact and ensure their long-term sustainability.

The Cleveland-based steelmaker has been testing hydrogen injections into Indiana Harbor Blast Furnace #7 in East Chicago and anticipates its blast furnaces will be heated in the future by a mix of the traditional coke, the natural gas it's already been using and at least half hydrogen, Cleveland-Cliffs’ Chairman, President and Chief Executive Officer Lourenco Goncalves said during a visit to United Steelworkers Local 6787 in Burns Harbor.

Cleveland-Cliffs anticipates being the largest customer of the hydrogen hub planned near the BP Whiting Refinery when it comes online in 2029. Goncalves said it could be a transformative investment that would drive economic development in the Calumet Region, including the potential of auto plants for hydrogen-powered vehicles.

The steelmaker already built a multimillion-dollar hydrogen pipeline to Cleveland-Cliffs Indiana Harbor Works in East Chicago.

"We are always investing in our plants," he said. "In this area, we are going to have the most important thing, a game-changer, hydrogen. Hydrogen is coming. Hydrogen is a game-changer."

The steelmaker hopes to lessen its carbon footprint.

"Hydrogen is a game-changer because hydrogen is a reductive like carbon is a reductive," he said. "But carbon produces CO2. Hydrogen produces H20. H20 is water vapor. The decarbonization will get a real boost when we'll have the hydrogen here. That's the biggest thing."

Cleveland-Cliffs successfully injected hydrogen into Indiana Harbor Blast Furnace #7 in East Chicago, using it as 12% of the fuel mix. It hopes to get the level up to 20% by the next test.

"This is new technology. We started in the single digits but we're already up to higher. We believe when hydrogen is widely available, we're going to be able to pass 50%," he said. "We hope that it will have a positive impact on our costs but it depends on how cheap hydrogen will be. This is a chicken-and-egg thing. Hydrogen is not used because nobody produces hydrogen. And nobody produces hydrogen is because nobody uses hydrogen. So what we're doing we are making viable for the hub to exist. Our offtake with Indiana Harbor, which will be first, and Burns Harbor, which will be next, will be 200 tons of a hub that will produce 1,000 tons a day."

The U.S. Department of Energy pledged $1 billion to in part build a hydrogen production hub in Whiting that would serve industry in Indiana, Illinois and Michigan, helping them transition away from fossil fuels. The private sector is expected to contribute another $5 million to $8 billion to a project that would employ more than 16,000 skilled tradesmen.

"We'd use 20%. We'd by far be the biggest user," he said. "Then the hub is a go because there's demand. There's baseload. Then car manufacturers could build cars here that would be fueled by hydrogen. Toyota, Hyundai and Honda are very interested and I'm sure others will follow. This is a game-changer. This is an enabler. The hydrogen will enable a different type of manufacturing that would be based in hydrogen, not in carbon. The industrial revolution was built in carbon. The second industrial revolution I'm envisioning is based in hydrogen."

A hydrogen hub in Whiting could lure more industry like auto manufacturing to Northwest Indiana, Goncalves said.

"That's where the concentration would be," he said. "I already sell them steel and I would rather have them closer. They certainly will not be in Michigan for hydrogen because hydrogen's here, not there. Hydrogen can travel by pipeline but chances are if the production is here, they will be here because it will be easier for them. There's no point in being far away. So it's a great opportunity for Northwest Indiana to capitalized off of the hydrogen."

Automakers like Toyota already have been developing hydrogen fuel cells for vehicles, Goncalves said.

"It's a technology that's already being developed. I'm not talking pie in the sky. Everything you can do with natural gas you can do with hydrogen," he said. "Hydrogen is a good replacement for natural gas and more than excellent replacement for coke."

Investing in hydrogen at the steel mills could be a transformative catalyst for the area, Goncalves said.

"That's what steel mills do. Steel mills bring development to the surrounding area," he said. "Imagine a circle and a bigger circle around the circle. Steel mills are in the center because we supply others. One job generated in the steel mill usually generates 10 new jobs in the surrounding area, from clients to restaurants to dry cleaners. That's what we do."

Cleveland-Cliffs will keep doing hydrogen tests at Indiana Harbor through the end of the year. It picked Blast Furnace No. 7 for the trial because it's the largest.

"Why I did Indiana Harbor first is it's the biggest," he said. "If it works there, it works everywhere."

It anticipates being able to supply the mills from the hydrogen hub in 2029.

"We are trying to expedite that as much as possible," he said. "We have technology for blast furnaces here in this area that is more developed than anywhere else in the world. We mix coke with natural gas. Here in the United States particularly in the Midwest – Middletown, Burns Harbor, Indiana Harbor, Gary, Cleveland – we have natural gas. With natural gas you can replace a portion of the coke. That's why my emissions are much better than the emissions in Japan. Natural gas is not carbon. It's CH4. It's methane. Natural gas is more carbon friendly than coke and we use a lot of natural gas."

Natural gas replaces at least 30% to 40% of the coke that historically would have gone into blast furnaces here.

"We use natural gas to the maximum possible limit," he said. "Burns Harbor uses the lowest coke rate in the western world. It's significant."

Hydrogen will allow Cleveland-Cliffs to replace even more coke, a purified form of coal, in its blast furnaces.

"We'll use more and more hydrogen. We try to minimize the coke as much as we can," he said. "With the hydrogen we believe we can cut our emissions, which are now 1.54 tons of CO2 per ton of steel company-wide. That's the lowest of any blast furnace anywhere in the world. Nippon Steel is 1.96 tons of CO2 per ton of steel. The average is the world is 2.15. We are much better, not just better but much better. When we have hydrogen, this number will go below 1 ton of CO2 per ton of steel. We're going to replace so much coke with so much hydrogen. We are the leader now but we're going to have a number I never would have even imagined."

Cleveland-Cliffs still anticipates using some coke to maintain the mechanical stability of the blast furnaces.

"You always need some coke," he said. "Remember hydrogen is a gas. Natural gas is a gas. Coke is a solid. Otherwise that thing doesn't sustain itself. So there will always be some coke. But what's the problem? The problem is generating less CO2. With hydrogen we will generate less CO2."

Cleveland-Cliffs eventually will need to build a hydrogen pipeline to Burns Harbor as well.

"We're working toward the target of having hydrogen at an industrial scale by 2029 so we'll have plenty of time," he said.
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