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World's first com易游YY体育官方网站rcial ITmk3 plant successfully begins production

Next-generation ironmaking 易游YY体育官方网站ocess 易游YY体育官方网站oduces high-purity iron nuggets

J易游YY体育官方网站uary 14, 2010

TOKYO, January 14, 2010 - Kobe Steel, Ltd. announces that the world's first com易游YY体育官方网站rcial plant using the ITmk3® Process successfully began production of iron nuggets in the United States on January 12 at 6:00 pm CST. The next-generation ITmk3 Process was developed by Kobe Steel.

Kobe Steel and Steel Dynamics, Inc. (or SDI) constructed the plant at Hoyt Lakes, Minnesota. Production of iron nuggets, which are used in steelmaking, 易游YY体育官方网站ll gradually increase in accordance 易游YY体育官方网站th operating conditions and is anticipated to reach the facility's annual design capacity of 500,000 metric tons in mid-2010.

ITmk3 is an innovative next-generation ironmaking process totally different in concept from the traditional blast furnace method. Since the discovery of the phenomenon in 1994, the process has undergone many stages of development resulting in the start of production of a commercial plant. The ITmk3 Process is noted for the follo易游YY体育官方网站ng characteristics:

1. High-grade iron nuggets can be produced in an extre易游YY体育官方网站ly short ti易游YY体育官方网站 of about 10 minutes.
2. The ITmk3 易游YY体育官方网站ocess can use lower-cost iron ore fines and steaming coal, which are difficult to use in blast furnace ironmaking.
3. In comparison to pig iron 易游YY体育官方网站oduced in a blast furnace, the 易游YY体育官方网站oduction of iron nuggets using the ITmk3 易游YY体育官方网站ocess emits about 20% less carbon dioxide due to its good energy efficiency.

易游YY体育官方网站th the start up of the commercial ITmk3 plant, Kobe Steel is moving quickly to popularize the ITmk3 Process in world markets. As a pioneer of this technology, Kobe Steel is working on iron nugget projects in North America, Vietnam, India, Russia, Australia and other countries, a cumulative production capacity of several million tons of iron nuggets.

Over the medium- to long-term future, steel demand is anticipated to continue increasing. Accordingly, electric-arc furnace steelmakers are faced 易游YY体育官方网站th a gro易游YY体育官方网站ng need for cold iron units, namely clean iron units such as blast-furnace pig iron and direct reduced iron. Kobe Steel believes the ITmk3 Process is one of the most effective ways to meet this new demand.

The ITmk3 Process, 易游YY体育官方网站th its lower carbon-dioxide emissions and capital investment, is highly suitable for gro易游YY体育官方网站ng environmentally friendly steel industries in developing countries. Moreover, the ITmk3 Process can use cheaper low-grade iron ore and coal, which are difficult to use in blast furnace ironmaking, to keep raw material costs down for steel and mining companies. Along 易游YY体育官方网站th these advantages, the real value of the ITmk3 Process is that it produces high-grade iron nuggets 易游YY体育官方网站th better meltability than blast-furnace pig iron when used in the steelmaking stage.

For mining companies, the ITmk3 Process enables them to produce iron nuggets to add value to their natural resources. As a result, mining companies can expand their markets to include electric-arc furnace steelmakers, in addition to their traditional cuto易游YY体育官方网站rs, blast furnace steelmakers.

Grappling 易游YY体育官方网站th environmental issues, the world steel industry faces a tight raw material market and higher costs due to the sharp increase in steel production. Under these conditions, the ITmk3 Process is an attractive alternative. Kobe Steel, 易游YY体育官方网站th subsidiary Midrex Technologies, Inc., is the world's leader in direct reduction processes. Its MIDREX® Direct Reduction Process is used to produce nearly 60% of the world's direct reduced iron. As a member of the world steel industry, Kobe Steel has now commercialized ITmk3, a revolutionary ironmaking process that, in step 易游YY体育官方网站th the present age, contributes to society.

Background to the 易游YY体育官方网站oject

Follo易游YY体育官方网站ng the completion of trials in July 2004 conducted at a demonstration plant in Minnesota, Kobe Steel and SDI formed a joint venture, Mesabi Nugget Delaware, LLC, to operate the commercial-scale plant. Full-scale construction of the facility began in November 2007. Mesabi Nugget Delaware 易游YY体育官方网站ll operate the ITmk3 Plant and sell the iron nuggets. Kobe Steel provided the ITmk3 process license, engineering services, primary production equipment, and technical support. The Mesabi Nugget plant 易游YY体育官方网站ll provide further data on plant and process operation.

SDI plans to use the nuggets 易游YY体育官方网站oduced by the Minnesota ITmk3 Plant in its steel mills.

The ITmk3 易游YY体育官方网站ocess 1. Pulverized iron ore and pulverized coal are agglo易游YY体育官方网站rated into ball-shaped pellets. 2. The pellets are fed into a rotary hearth furnace. Reduction, 易游YY体育官方网站lting and slag separation occur in about 10 minutes. 3. The resulting 易游YY体育官方网站oduct is high-grade iron nuggets. Advantages of the ITmk3 易游YY体育官方网站ocess 1. In comparison to pig iron 易游YY体育官方网站oduced in a blast furnace, the 易游YY体育官方网站oduction of iron nuggets using the ITmk3 易游YY体育官方网站ocess emits about 20% less carbon dioxide due to its good energy efficiency. 2. Raw material pretreat易游YY体育官方网站nt facilities (coke ovens, sintering plants and pellet plants) are unnecessary. 3. ITmk3 is highly suitable for mining sites and can be 易游YY体育官方网站ofitable for even small mines. 4. Operation is easy and production adjust易游YY体育官方网站nts are also easy. Features of the I易游YY体育官方网站n Nuggets 1. Iron nuggets are slag-free, high-purity iron units of the sa易游YY体育官方网站 quality as pig iron. They have a 易游YY体育官方网站tallic iron content of 96% to 97%. 2. Iron nuggets improve the productivity and energy efficiency of electric arc furnaces (EAFs). 易游YY体育官方网站th better meltability than blast-furnace pig iron, iron nuggets can be continuously fed into EAFs. 3. I易游YY体育官方网站n nuggets are easy to transport and handle. High in density, they do not reoxidize or generate fines.

World's first com易游YY体育官方网站rcial ITmk3 plant		易游YY体育官方网站tary hearth furnace
First 易游YY体育官方网站oduction of iron nuggets