Hyundai Steel Cuts Carbon 70% Using Natural Gas Instead of Coal

DONALDSONVILLE — Hyundai Steel (004020) and POSCO are accelerating their shift to low-carbon steel production through the Hyundai Steel Louisiana plant (HPLS).

Hyundai Steel said on the 6th that HPLS will attempt the world's first process to produce low-carbon automotive steel sheets based on an electric arc furnace. At the core of the plant's environmental credentials, cited as its biggest competitive edge, is the direct reduction plant (DRP). The DRP uses natural gas and other inputs to reduce solid-state iron ore into direct reduced iron (DRI), a high-quality steelmaking raw material. The process cuts carbon emissions by about 70% compared with the indirect reduction used in coal-fired blast furnaces.

The integrated system, designed to produce DRI directly, feed it into an electric arc furnace and turn out finished products, maximizes energy efficiency and productivity. Iron produced at the DRP goes straight into the next stage — an electric arc furnace equipped with continuous charging facilities — where it is fed alongside high-grade steel scrap and other materials to become low-carbon molten steel.

Because HPLS produces DRI in-house rather than sourcing it externally, it can raise the share of DRI in the charge mix and make higher-grade steel products than conventional electric arc furnaces that rely solely on steel scrap. The plant plans to build a sustainable process by minimizing impurities such as nitrogen and sulfur through precision refining facilities, while preemptively managing carbon generated during operations with carbon capture and storage (CCS) equipment.

Hyundai Steel plans to eventually replace the natural gas used in the DRP with hydrogen. If natural gas is fully converted to hydrogen, carbon emissions from the process are expected to converge on zero. Once the low-carbon production system at HPLS, including that shift, stabilizes, the company aims to expand it to its domestic plants to quickly complete an environmentally friendly steel supply chain. Hyundai Steel has previously announced a roadmap to achieve carbon neutrality by 2050.

Hyundai Steel has prior experience producing about 1 million tons a year of high-value flat products, including automotive steel sheets and shipbuilding plate, using electric arc furnaces between 2007 and 2010. In 2022, it became the first in the world to produce 1.0-gigapascal-class high-strength, low-carbon automotive steel sheets in an electric arc furnace. Since February this year, it has also been running a combined electric arc furnace and blast furnace process at its Dangjin steelworks that cuts carbon emissions by 20% compared with conventional blast furnaces.