Shale Gas Revolution Spurs Wave of New U.S. Steel Plants
01/02/2013 - The U.S. shale-gas revolution, which has revitalized chemicals companies and prompted talk of domestic energy self-sufficiency, is attracting a wave of investment that may revive profits in the steel industry, the Pittsburgh Post Gazette reports.
The U.S. shale-gas revolution, which has revitalized chemicals companies and prompted talk of domestic energy self-sufficiency, is attracting a wave of investment that may revive profits in the steel industry.
Austrian steelmaker Voestalpine AG said 19 December 2012 it may construct a €500 million (US$661 million) factory in the U.S. to benefit from cheap gas. Nucor Corp., the most valuable U.S. steelmaker, plans to start up a $750 million Louisiana project in mid-2013. They're among at least five U.S. plants under consideration or being built that would use gas instead of coal to purify iron ore, the main ingredient in steel.
"That technology has been around 30 years, but for 29 years gas prices in the U.S. were so high that the technology was not economical," said Michelle Applebaum, managing partner at consulting firm Steel Market Intelligence in Chicago. "This is how steel will be built moving forward."
The new capacity may signal a turnaround for an industry that has suffered from overcapacity since the financial crisis and collapse in commodity prices four years ago. U.S. steelmakers have struggled to stay profitable amid sluggish domestic demand, depressed prices and competition from Chinese imports. While global steel output has grown by 14% since 2008, U.S. production has shrunk 3.4%...
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