NEW YORK Austrias
largest steelmaker, Voestalpine Group, has selected Corpus
Christi, Texas, for its planned 2-million-tonne-per-year
hot-briquetted iron (HBI) and direct-reduced iron (DRI)
"We examined a total of 17 sites
in eight countries for this project, the largest foreign
investment in the groups history to date," Wolfgang Eder,
chairman of Voestalpines management board, said in a
statement March 13. "In the end, Texas was the most convincing
in terms of all the key criteria, including logistics, energy
supply, a well-educated work force and the political
The steelmaker said it is still
negotiating with local authorities over a 500-acre site on
Corpus Christi Bay in San Patricio County, and it expects to
make a final decision on whether to proceed with the project
before the summer.
The proposed project, estimated
to cost 550 million euros ($711.7 million), also requires
permitting approval from federal and state environmental
authorities, which is expected to take about 15 months, the
Linz, Austria-based company said. If development goes as
planned, the plant is expected to be operational by 2016 with
around 150 employees.
Voestalpine said the plant will
produce both DRI and HBI from iron ore pellets, using natural
gas as the reducing agent. Half of the production will be
shipped to the parent companys steel mills in Linz and
Donawitz, Austria, while the other half will remain as a
"strategic reserve" and initially be sold to partners
interested in longer-term contracts.
"In the (United States), we can
access energy cost efficiently and operate in a politically
stable, predictable environment," Eder said. "This investment
also provides the Voestalpine Group an additional growth option
in North America over the long term. It would have been
impossible to build a comparable plant in the European Union,
not least because of a lack of competitiveness in terms of
AMM reported in
December that the company was eyeing a possible greenfield
steel raw materials plant in Texas, with sources close to the
project at that time citing Houston as one possible location
amm.com, Dec. 17).
Eder suggested this week that
one of the reasons behind its decision to locate in Texas was
the states environmental policies, which may be more
industry-friendly than other locations.
"We will ... be investing in the
exceptionally strict U.S. environmental and safety standards
and applying state-of-the-art processes for reducing emissions
of pollutants, noise and dust. This also includes dealing
responsibly with the water supply, a scarce resource in Texas,"
said Eder, noting that while U.S. environmental regulations
"are similarly stringent" to those in Europe, "Texas is taking
a different route."
The company did not say whether
it had plans to eventually build a steel mill in the United
States to use the DRI and HBI feed, and a company spokesman did
not respond to requests for additional comment.
The investment comes as the
company continues its push into North America. Voestalpine
announced in August plans to build a $62-million auto body
parts manufacturing facility near Cartersville, Ga. (
amm.com, Aug. 23), while it said in December that
a subsidiary had acquired tool and mold steel distributor and
processor Sturdell Industries Inc. for an undisclosed sum (
amm.com, Dec. 10).
Investments in DRI are a growing
trend for the steel sector. Charlotte, N.C.-based steelmaker
Nucor Corp. is building a 2.5-million-ton-per-year DRI facility
in St. James Parish, La., with the option to expand (
amm.com, Oct. 19), while other
companiesincluding North Star BlueScope Steel LLC (
amm.com, Aug. 21), Essar Steel Minnesota LLC (
amm.com, Dec. 19) and OAO Severstal (
amm.com, Jan. 10, 2012)are said to be
looking into their own possible projects.