Dutch CCS project scrapped after Tata Steel opts for hydrogen DRI production route

The Athos carbon capture and storage project in the Netherlands has been canceled following project partner Tata Steel's decision to develop a direct reduced iron process using hydrogen, Athos said Sept. 20.

The company's decision was the basis for the CCS project, and its decision to opt for a hydrogen-based DRI production route has undermined it, Athos said.

"The expected Tata Steel CO2 volume available for the Athos project was the basis for its conceptual, technical and economical considerations," Athos said. "The Tata Steel decision to switch to the DRI technology means that the Athos project cannot proceed in its current form."

Tata Steel said Sept. 15 that it would pursue a DRI route with hydrogen at its IJmuiden plant.

The steel company has ambitions to reduce CO2 emissions from its IJmuiden plant by 5 million mt/year by 2030, and had been studying options including CCS or a hydrogen route.

The Athos project had worked with founding partners EBN, Gasunie, Tata Steel and the Port of Amsterdam in recent years on a large-scale CO2 transport, utilization and storage project in the North Sea Canal area, Athos said.

A study in 2019 found a CCUS facility at the site was technically feasible and had the potential to reduce CO2 emissions by 7.5 million mt/year by 2030.

The hydrogen-based DRI steelmaking route is emerging both in Europe and worldwide as the preferred and potentially the most efficient path to carbon neutrality.

In addition to Tata Steel Europe's moves in this direction, steelmaker ArcelorMittal and Liberty Steel Group are both developing hydrogen-based DRI steelmaking facilities in Europe.

Steelmaker sources are confident that increasing availability of green hydrogen will eventually reduce its costs, allowing green steel produced by this route to be competitive in the market.

"By choosing hydrogen as the technology to produce steel in the Netherlands, we want to take an important strategic step in making our steel production more sustainable," Tata Steel CEO Thachat Viswanath Narendran said in a statement Sept. 15.

"The decarbonization pathway in IJmuiden will also help us chart the future transition roadmap of Tata Steel's other integrated steel-making sites," Narendran said.

S&P Global Platts assessed the cost of producing renewable hydrogen via alkaline electrolysis in Europe at Eur9.01/kg ($10.57/kg) Sept. 20 (Netherlands, including capex). PEM electrolysis production was assessed at Eur10.86/kg, while blue hydrogen production by steam methane reforming (including carbon, CCS and capex) was at Eur4.89/kg.

Athos said the project partners would continue to work with Tata Steel to assess CO2 emissions reduction potential in the area.