Plasma to help clean up steelmaking
Plasma to help clean up steelmakingSIGNIFICANT NEWS
Europlasma sees a long-term market in applying plasma-based clean-up know-how to steel furnaces. Revenue prospects and timetable are not available.
FACT
Europlasma has announced a technical breakthrough. It plans to deploy its plasma-based gas-cleaning technologies in steel furnaces. Arcelor Mittal is a partner at a pre-industrial stage with the ambition to deploy the technology to reduce its massive CO2 footprint (c.190Mt). Funding of the pre-industrial stage is backed by SGPI, a French government effort to deploy €57bn in structuring projects including those helping to reduce carbon emissions.
ANALYSIS
This effort is at a very early stage. The principle is to convert carbon-rich exhaust gases into syngas (using plasma- cleaning capabilities) for reinjection into the furnace as fossil energy that recombines with air (and sometimes added oxygen) for the steel-making process.
As the process cuts both the CO2 emissions and the energy input, its potential value for the worldwide steel industry is presumably enormous. It is good that Europlasma has been working with ArcelorMittal, the biggest steel player in what remains a very fragmented industry, to bring such a technology to a pre-industrial stage.
The urgency of the CO2 emission dilemma has recently been made clear in China with the forced closure of inefficient steel capacity in winter when the pollution is made worse by cold temperatures and the lack of wind.
We understand that the Europlasma technology is complementary to the use of oxygen in steel manufacturing. Oxygen improves the combustion, i.e. reduces the production of unwanted gases. Europlasma makes good use of exhauset CO2 and methane gases to turn them into a useful syngas.
IMPACT
Europlasma’s management is shy about venturing to put any figure on the project, the initial phase of which has been about two years in the making. Pre-industrial tests, presumably in Europe, may well take another year so that any implementation in scale is a long-term perspective. In an ideal world, that would mean Europlasma delivering ad hoc torches in big numbers and relevant engineering services. Putting any figure on such an opportunity is currently a stretch as it also depends on the cost of CO2. While Europlasma is well on its way to becoming a green energy group as its waste to power proposition is now up and running, it remains an equipment provider with green credentials as it happens. Currently, the provision of plasma torches in our forecasts is limited to those deployed in its green energy projects. No impact on earnings nor valuation beyond a positive sentiment.
Europlasma SA. Europlasma SA is a France-based company that offers a range of solutions for hazardous waste treatment. The Company's technology allows converting toxic waste into reusable materials. The Company is composed of four entities, such as Europlasma Torch & Process, which provides engineering consulting for hazardous waste treatment, and sells and licenses its plasma torches and technology; Inertam SAS, which specializes in destruction and valorization of asbestos waste and operates ash melting units; CHO Power SAS, which supplies technological solutions for the efficient transformation of biomass and waste into electric energy and Europe Environnement, which offers ventilation and air cleaning systems for industrial applications.
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