Mikhailovsky HBI, created by Alisher Usmanov’s USM group and Mikhailovsky GOK (part of Metalloinvest, also owned by Usmanov), will receive a credit line from Sberbank for $ 620 million for the construction of a hot briquetted iron plant in the Kursk region. The SPIEF agreement was signed by USM CEO Ivan Streshinsky and Sberbank Deputy Chairman of the Board Anatoly Popov. The line will be open until December 31, 2034.
“Mikhailovsky HBI will work in close technological cooperation with Metalloinvest, the largest producer of commercial HBI in the world market, and will strengthen Russia’s position as the world’s leading supplier of raw materials for sustainable steel production chains,” said Ivan Streshinsky.
USM and Metalloinvest announced a joint venture (55% vs. 45%) in February. The plant, which is planned to be launched in the first half of 2024, will be located in Zheleznogorsk, next to the Mikhailovsky GOK of Metalloinvest. The plant’s capacity is 2 million tons of hot briquetted iron (HBI) per year, investments – 40 billion rubles.
By the end of 2020, Metalloinvest produced 7.8 million tonnes of hot briquetted and direct reduced iron. Global demand for these products is growing as the use of HBI reduces CO2 emissions in the production of electric steel, and this aspect is becoming increasingly important for metallurgical companies amid tightening carbon regulations and the EU’s plans to introduce a carbon tax.
By 2030, steel production is expected to increase by 17%, to 2 billion tons, with more than 95% of the increase coming from steel smelting in electric furnaces.