Cleveland-Cliffs to License Kobe Steel’s Iron Nugget Technology
06/20/2007 - Under a new alliance, Kobe Steel will license its patented ITmk3 iron-making process to Cleveland-Cliffs for use in the U.S., Canada, Australia, and Brazil. The two companies are also planning to build a joint-venture iron nugget facility.
Cleveland-Cliffs Inc. has entered into an alliance with Kobe Steel under which Kobe Steel will license its patented ITmk3(R) iron-making process to Cleveland-Cliffs. The alliance, which has a 10-year term, covers use of the proprietary process in the United States, Canada, Australia and Brazil, and may be expanded to include other geographic regions.
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Under the new alliance, Kobe Steel will license its patented ITmk3 iron-making process to Cleveland-Cliffs for use in the U.S., Canada, Australia, and Brazil.
Cliffs and Kobe Steel have also agreed to participate on a joint-venture basis as strategic equity partners in a 500,000 ton per year iron nugget facility to be constructed at one of Cliffs' United States mining properties.
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The ITmk3 process is capable of producing high-purity iron nuggets containing more than 96% iron — sufficiently high quality to serve as a raw material feedstock for electric arc furnace (EAF) based steel production. Steel producers utilizing EAFs currently account for nearly half of North America's steelmaking capacity.
“One of Cliffs' major strategic initiatives is to sustain its leadership position in pioneering processes related to metallics,” said Cliffs Chairman, President and CEO Joseph A. Carrabba, commenting on the new alliance. “By constructing a commercial-scale facility that will produce iron in nearly pure form, we will further that mission and be able to offer North America's non-integrated steel mills a consistently available and very high-quality domestic metallic feed, which is similar in quality to imported pig iron. Moreover, as Cliffs currently sells the majority of its pellets to integrated steel companies in North America, this opportunity has the potential to open a new market.
“We have been very interested in this technology since successfully testing the process in a pilot plant located at our Northshore facility,” said Carrabba. “The alliance with Kobe moves us closer to realizing our mutual goal of commercializing and exploiting this innovative process.”
The company also said the two parties have agreed to participate on a joint-venture basis as strategic equity partners in a 500,000 ton per year iron nugget facility to be constructed at one of Cliffs' United States mining properties. The timing of this project and the site location will ultimately depend on permitting issues.
Headquartered in Cleveland, Ohio, Cleveland-Cliffs Inc. is the largest producer of iron ore pellets in North America, selling the majority of its pellets to integrated steel companies in the United States and Canada. Cleveland-Cliffs operates a total of six iron ore mines located in Michigan, Minnesota and Eastern Canada. The company owns 80% of Portman Limited, a large iron ore mining company in Australia, serving the Asian iron ore markets with direct-shipping fines and lump ore. It also has a 30% interest in the Amapa Project, a Brazilian iron ore project, and a 45% economic interest in the Sonoma Project, an Australian coking and thermal coal project.
