MQM Industry Blog : The Green Steel Revolution

The global steel industry is at a pivotal moment as the race to decarbonize intensifies. The Green Steel Challenge podcast recently featured Maria Persson Gulda, CTO of Stegra (formerly H2 Green Steel), to discuss their groundbreaking efforts in green steel production. Based in Boden, Sweden, Stegra is leading the charge with its fully integrated facility, powered by green hydrogen and fossil-free electricity. With the potential to reduce CO₂ emissions by up to 95%, this project is a blueprint for transforming one of the world’s most carbon-intensive industries.

The Rise of Green Steel

Stegra was founded in 2021 with a bold vision: to prove that large-scale green steel production is possible and inspire the industry to accelerate its pace of change. Backed by €6.5 billion in funding, the company is building a state-of-the-art facility designed to produce 2.5 million tons of green steel annually by 2026, with plans to scale to 4.5 million tons.

Their approach involves a combination of innovative technologies, including:

• Direct Reduction Iron (DRI): Using green hydrogen to replace traditional natural gas, cutting emissions significantly.
• Electrolyzers: Modular systems producing green hydrogen on-site using renewable electricity.
• Energy-Efficient Mini Mills: Inspired by U.S. designs, these mini mills reduce energy consumption while improving cost efficiency.

Stegra’s approach not only reduces emissions but also creates a more sustainable supply chain, attracting automotive, construction, and white goods industries eager to meet stricter environmental standards. Long-term contracts with major brands like BMW and Electrolux showcase the strong demand for green steel.

Challenges and Opportunities

While Stegra’s innovations are promising, scaling these technologies presents unique challenges. From ensuring electrolyzer longevity to integrating multiple production steps seamlessly, the company is navigating uncharted waters. Yet, these risks come with immense opportunities, including leadership in industrial hydrogen production and setting new benchmarks for sustainability.

Why Location Matters

Stegra’s choice of Boden, Sweden, highlights the importance of location for green steel projects. Access to abundant, affordable green electricity and a supportive permitting process were critical in bringing their vision to life. This strategic location also ensures a low-cost, low-emission operation, positioning Stegra on the lower side of the cost curve in Europe.

How Lac Otelnuk Iron Ore Project Can Benefit

The Lac Otelnuk Iron Ore Project, 100% owned by MetalQuest Mining, could play a pivotal role in the green steel revolution. With its vast reserves of high purity iron ore in northern Quebec’s Labrador Trough region, the project is well-positioned to supply the emerging green steel industry. High-grade ore is essential for DRI processes, as it requires less energy and reduces impurities, aligning with the sustainability goals of companies like Stegra. Additionally, Lac Otelnuk’s proximity to renewable energy sources in Quebec could attract partnerships with green steelmakers seeking low-carbon supply chains.

As the global steel industry transitions to greener practices, projects like Lac Otelnuk have a unique opportunity to position themselves as vital suppliers of premium raw materials to this evolving market.

A New Chapter for Steel

Stegra’s success not only highlights the feasibility of green steel production but also sets a precedent for other players in the industry. By leveraging cutting-edge technology, strategic location choices, and sustainability commitments, they are proving that a low-carbon future for steelmaking is within reach. For resource-rich projects like Lac Otelnuk, this transition presents a once-in-a-generation opportunity to support and benefit from the industry’s shift to greener solutions.

The road to decarbonizing steel is long, but with pioneers like Stegra leading the charge, the future looks increasingly bright—and green.