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New Business Horizon with ITmk3® Producing the Pig Iron from the Oxidized Iron Ore Concentrate in one Technological Pr PowerPoint Presentation
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New Business Horizon with ITmk3® Producing the Pig Iron from the Oxidized Iron Ore Concentrate in one Technological Process. Working Paper for the ITmk3® Family Conference Kyiv, April 3, 2009 Prepared by Razaz Younes Managing Director Hares Engineering GmbH. .

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New Business Horizon with ITmk3®Producing the PigIron from the Oxidized Iron Ore Concentratein one Technological Process

Working Paper for the ITmk3® Family Conference

Kyiv, April 3, 2009

Prepared by Razaz Younes

Managing Director

Hares Engineering GmbH.

iron and steel industry main problems
Iron and Steel Industry Main Problems
  • In addition to several issues, the Iron and Steel Industry is facing the following main problems:
    • The BF and BOF are facing the serious problem in the supply of its raw material, which it is:
      • Iron Ore pellets produced from the magnetite ore with sufficient iron content (about 67%)
      • Metallurgical coke
    • EAF is facing the shortage in the Scrap supply
    • The environmental situation in world starts to be in position that it is not possible to produce more steel with current emissions level; serious solution should be developed to avoid more harms to our nature
    • At the same time, a stable demand on the steel will always exist due to increase of the world population. The new coming generations will be in need of steel to build their civilization
oxidized iron ore in the nature
Oxidized Iron Ore in the Nature
  • Usually the Oxidized iron ore “Hematite” exists in the upper layer because of the oxidization reaction with the atmosphere and below the “Hematite” layer the Magnetite is lying down.
  • Beneficiation of the Hematite is difficult and expensive comparing with the Magnetite, therefore the mine company that has the both types usually prefer to extract the hematite and to store it in order to reach the Magnetite that will be more efficient to beneficiate. This will lead to:
    • Huge amount of the Hematite to be stored that creates environmental problem
    • Considerable costs should be born to extract the Hematite and to store it without any direct investment relation to this natural resource; usually, these costs to be calculated on the magnetite mining cost.
    • The iron content existing in the Hematite will stay without its value account, since the investment into the Magnetite will always be more efficient; somehow, it is national resource which is not relevantly capitalized.
pig iron production by itmk3 comparing with the classic technologies
Pig Iron Production by ITmk3® comparing with the Classic Technologies

 The below calculation is typical and it is considered the market indicators of 2007 to avoid the market turbulence caused by the current crisis that provides unreadable factors

  • ITmk3® is producing the pig iron nuggets
  • The raw material of ITmk3® is the iron ore concentrate
  • Pig iron is producing in Blast Furnace
  • The raw material of BF is the pellets
  • Pellets are produced from the iron ore concentrate
  • Summarized calculations :
  • Production of the pig iron by classic technology (blast furnace) costs 300-325 USD per ton, the sales price of pig iron is 340-360 USD per ton and capital investment is equal to 300 USD per ton of production. To produce the pellets it is required to invest 50-60 USD per ton of capacity. Therefore, investment capital for each ton of pig iron starting from concentrate (as ITmk3®) is equal to 300+60= 360 USD
  • Production of the pig iron by ITmk3® technology costs 150 USD per ton, the sales price is 340 USD , and the capital investment is equal to 300 USD per ton of production.
  • As summary: production cost per ton of pig iron nuggets by ITmk3® is less by 50% from the production cost in Blast Furnace, and capital investment per ton in case of ITmk3® is less by 20% of the investment required in case of Blast Furnace.

Iron Ore Concentrate


Pig Iron

Price: 340 $/Ton

Beneficiation Plant

Pelletizing Plant

Blast Furnace

Production costs: 300 $ per ton

Capital costs:

60 $ per ton

Total capital costs:360 $/T (60 $/T for pelletizing +300 $/T in Blast Furnace)

Iron nuggets

Price: 340 $/Ton

Iron Ore Concentrate

Beneficiation Plant

ITmk3® Plant

Production costs: 150 $ per ton

Total capital costs: 300 $ per ton

itmk3 experience with oxidized iron ore
ITmk3® Experience with Oxidized Iron Ore
  • Kobe Steel has tested several types of hematite iron ore in the box furnace in Kobe’s Laboratory
  • Some of them were tested by a continuous operation at the bench scale test facility in Kobe’s Kakogawa works
  • One US hematite was tested in Mesabi Nugget Pilot Demonstration Plant in Minnesota
  • Recently and as result of the cooperation between Kobe Steel, Hares Engineering and Ministry of Industrial Policy of Ukraine on evaluation of the possibility to produce the iron nuggets from the Hematite concentrate beneficiated at KGOKOR laboratory using the High Intensive Electro-Magnetic beneficiation method designed for the KGOKOR, the iron Nuggets have been successfully produced
  • Tables below show the experience of the ITmk3® in production of Iron Nuggets from several international resources of Hematite, including the Ukrainian Hematite from KGOKOR
real example kgokor project in ukraine
Real Example: KGOKOR Project in Ukraine
  • The KGOKOR Project has been designed to produce the pellets from the hematite iron ore by the following technological steps:
    • Crushing & milling the hematite iron ore, or the raw material preparation section
    • Beneficiating the oxidized iron ore by High Intensive Electro-Magnetic method to produce the hematite concentrate up to 61-64 % Fe content.
    • Pelletizing the concentrate into pellets
    • Roasting the pellets into roasting plant
  • General remarks on the current process at KGOKOR
    • The process will consume high energy, especially, the gas
    • Ukraine needs and works on developing new energy saving policy, especially, in the metallurgical and chemical industry, the biggest energy consumer sector in Ukraine
    • The result of this process is the pellets with low iron content what will provide relevantly with a product with low added value
    • Improvement of the beneficiation by using new technology like floatation would mean another investment capital and high beneficiation cost
    • The produced pellets should be treated in the BOF to produce the pig iron; this means another energy consumption, especially, the gas and more off gas emission, although Ukraine needs and is working on improving its environmental situation.
    • The complete investment cycle starting the hematite iron ore and finishing with the produced pig iron does not show a high efficient investment scheme.
kobe steel hares engineering suggestion for kgokor project solution
Kobe Steel - Hares Engineering Suggestion for KGOKOR Project Solution
  • Kobe Steel and Hares Engineering are cooperating with the Ministry of Industrial Policy of Ukraine to develop technical and economical solution for KGOKOR Project by using the ITmk3®. It is based on the following principles:
    • Completing the existing facilities in raw material preparation and beneficiation plant to produce the hematite iron ore concentrate with 62-64% Fe content (60% Fe content is workable for ITmk3®)
    • Using this hematite concentrate to produce the pig iron as Iron Nuggets avoiding the BOF and Blast Furnace process
  • General remarks on this solution:
    • Technically: the plant will produce new upgraded product with superior technical specification
    • Economically: the plant will produce high added value product that is demanded worldwide; the plant will start to enjoy feasible economical indicators
    • Environmentally: the plant will enable to produce the pig iron nuggets with less energy consumption and less emissions, especially, the CO2 (ITmk3® reduces Co2 emission up to 20% per each ton of produced pig iron)
    • Financially: the project will open new horizon for investors and the possibility to attract several international financial facilities due to the following main factors: the project is Feasible, its products are of International demand and upgraded to commodity level product, and the project is environmentally friendly
  • Kobe Steel and Hares Engineering are now in process of developing investment opportunity for KGOKOR Project, based on ITmk3® technology, by implementing international financing scheme
  • By ITmk3® and Oxidized Iron Ore it is possible to generate the Money stocked in the Oxidized Iron Ore Mines
  • The ITmk3® opens new investment opportunity to exploit the hematite iron ore, especially, in Ukraine where almost all mining companies stocking this raw mineral resource without good capitalization, creating another environmental problem and loosing good investment opportunity
  • ITmk3® produces the pig iron nuggets with less energy consumption and less environmental emissions
  • In Ukraine, exploitation of the hematite by efficient technology like ITmk3® will support the national income and will improve the investment in the national resource
  • In addition, The ITmk3® and EAF as Ukrainian Strategy to produce the Steel using the national resource of energy will lead to:
    • Reduction in consumption of the NG and forwarding its saved volume to other consumers
    • Energy saving in production of one ton of steel
    • More efficient use of the national resource of the energy
    • Improvement of the environment with keeping the steel productivity of the country
    • Will generate additional national income
in kazakhstan
In Kazakhstan
  • SBS Group
    • Hares Engineering agreed with SBS Group to build three ITmk3® Plants in Aktobe City by formula of 1+2. The engineering works to be started in April 2009
    • SBS Group is interested to build the first plant as soon as possible. This could request to start some of the construction works by SBS very soon
    • SBS Group has contracted Hares Engineering for the Engineering Works
in russia
In Russia
  • Aricom Group
      • Hares Engineering worked with Aricom for one year to evaluate the project
      • Aricom has contracted the company Hatch as independent consulting engineering company to decide about the best technology for their mine. Hatch reported that ITmk3® is the best available solution
      • Aricom also has contracted Hares Engineering to fulfilled Preliminary Plant Specification and Pre-Feasibility Study to install five plants at its Kimkano-Sutarsky Mine
      • Hares Engineering has fulfilled the above-mentioned study and the results were positive. Aricom confirmed in its strategic plan, published on its website, its intention to build five plants at its K&S Mine until 2016. Aricom intends to start the development of pre-contracting engineering and bankable feasibility study in 2009

EuroChem Project

    • EuroChem has contracted Hares Engineering to prepare PPS Study to install two plants at its mining company called Kovdorsky GOK. The study should be accomplished in April 2009 and two companies will decide on the next stage
    • The laboratory testing of the iron ore concentrate of Kovdorsky GOK showed positive results

OMK Project

    • OMK is one of the biggest producer of the steel pipes in Russia and Europe
    • It is one of the main suppliers of pipes for the North Stream Project to build the gas pipe line under the sea between Russia and Germany
    • The Iron Nuggets product provides OKM with the possibility to produce the goods of higher quality with less energy consumption which will provide OMK with higher efficiency for its industry
    • OMK has contracted Hares Engineering to prepare PPS study to install two ITmk3® plants
    • The study will be accomplished in May, 2009
in ukraine
In Ukraine
  • Metinvest is the biggest iron ore miner in Ukraine, it owns three mines in the country called SEV-GOK, C-GOK and IN-GOK
  • Hares Engineering is working with Metinvest for the last two years to prepare the PPS for its mines and accomplished two study for SEV-GOK and C-GOK
  • Metinvest requested Hares Engineering to use Hatch company as independent engineering company to evaluate the PPS study for SEV-GOK and C-GOK and to decide about the best technology comparing ITmk3® with other nine technologies. Hatch confirmed the accuracy of Hares Engineering study and recommended Metinvest that ITmk3® is the best technology for its mines
  • Metinvest is thinking about production of 2.5 million tons of Iron Nuggets, which means five ITmk3® Plants
  • Hares Engineering and Metinvest is still working on the last PPS study before the final decision
kgokor project
KGOKOR Project
  • ITmk3® is the only technology that could offer to this Project a real technical solution that provides the plant with the workable efficiency
  • Hares Engineering and Kobe Steel is creating consortium for the common investment in this Project
  • The Consortium contacted the Ukrainian Authority, who decided to cooperate in developing technical and economical solution for the KGOKOR Project
  • The Consortium is fulfilling preliminary engineering study to confirm the main objectives and the efficiency of the project (PPS Study)
  • The Consortium is working with the Governments of Japan and Ukraine to include this project under GIS Agreement between the two countries
  • The Consortium is discussing this project with potential investors and financiers. The results are encouraging