Cleveland-Cliffs cancels hydrogen-based steel project in Ohio

American steelmaker Cleveland-Cliffs has officially canceled its hydrogen-based steel project in Middletown, Ohio. This is reported by Fuel Cells Works.

Instead, the company will extend the life of its existing coal-fired blast furnace.

Cleveland-Cliffs CEO Lorenzo Goncalves cited delays in hydrogen production and expectations of changes in the Trump administration’s policy as the key reasons for this decision. He expressed serious doubts about the feasibility of the project, emphasizing that the necessary hydrogen would not be available in time to meet the needs of this initiative.

The original plan called for the installation of two electric arc furnaces and a direct reduced iron plant in Middletown, ready for hydrogen use. However, the lack of sufficient production of clean hydrogen in the United States made the project unviable. According to Goncalves, even with a $500 million grant, the company would need to invest an additional $1.1 billion, bringing the total cost of the project to $1.6 billion.

The Cliffs CEO also emphasized the difficulty of finding buyers willing to pay higher prices for green steel.

Earlier this year, in May, Goncalves said that the company would significantly change and reduce its plans to use hydrogen at the Middletown plant. He mentioned that Cliffs is in talks with the Trump administration to revise the grant to reflect new energy priorities.

The U.S. Department of Energy (DOE) supported the Middletown facility with a $500 million grant during the Biden administration. Although the department has not yet cut funding for the project, its future remains uncertain. The company is considering alternative approaches that do not rely on fossil fuels.

Last January, Cleveland-Cliffs announced that it had successfully completed hydrogen injection tests at blast furnace (BF) No. 7 at the Indiana Harbor metallurgical complex. This blast furnace is one of the largest in the world in terms of volume and production capacity, and differs from similar equipment in Japan, Korea, China and Europe in terms of technological capabilities for the production of high-quality steels. The unit is the company’s second BF to use hydrogen as a reducing agent and fuel source, following a successful test at Middletown Works in May 2023.