ArcelorMittal Saldanha Works Analyst visit 14 October 2011 History - - PowerPoint PPT Presentation

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ArcelorMittal Saldanha Works Analyst visit 14 October 2011 History - - PowerPoint PPT Presentation

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ArcelorMittal Saldanha Works Analyst visit 14 October 2011 History of Saldanha Works Nov 1995: Saldanha Steel project started 1995 (Iscor and IDC) Jan 1996: First bursars, recruited from the West Coast, sent to Newcastle for

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14 October 2011

ArcelorMittal Saldanha Works Analyst visit

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History of Saldanha Works

1995

  • Nov 1995: Saldanha Steel project started

(Iscor and IDC)

  • Jan 1996: First bursars, recruited from the West Coast,

sent to Newcastle for training

  • Sep 1996: First steel column erected
  • Aug 1997: Power available from Eskom
  • 14 Jun 1998: First steel produced
  • 20 Aug 1998: First hot rolled coil dispatched
  • 31 Dec 1998: Corex commissioned
  • 13 Jun 1999: Midrex commissioned
  • Jun 2005: Full capacity reached

(103 000 tons HRC)

  • Oct 2006: Record hot rolled coil production of 113 336

tons

  • September 2007 Record thin (<1.2mm) production of 31

004 tons

  • April 2008: Successful reline of Corex and Midrex (78

days)

  • July 2008: First 0.95mm rolled.
  • July 2011: 20 375 tons <1.09

1999 1996 1998 2005 2006 1997

Statistical information

  • Electricity consumption: 160 MW
  • Daily water consumption: 8 000 kilo liters

(world best for an integrated steel plant)

  • Manpower: 570 permanent employees
  • Sales output: 1,2 million ton HRC/annum

2007 2008 2011

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  • Saldanha Steel Works
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Process configuration

Integrated process flow

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Raw Material and Energy Impact on Cost Analysis (2011 Budget)

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Strategic focus

Primary Bottleneck : Corex / Midrex supply of FE units Restore Basic Conditions (WCM + 5S) Sustainability (Routine Management) Prevent long downtime risk – replenish critical spares Predict failures to reduce loss in production and maintenance cost – Online Condition Monitoring Secondary bottleneck : Conarc Normal heat 55min BOF heat 80min Scrap heat 90 min Maximise normal heats to maximise tempo – 50/50 HM and DRI Shortfall on DRI to be purchased Strategic projects Energy (Efficiency, purchasing, alternative technologies) Secure LPG supply Reduce LPG consumption Increase DRI production Increase By-product sales Increase Thin gauge production Pellet plant

2010 2011 2012 2013 2014

Stability Stability

2015 2016 2017

Energy & Raw Materials Energy & Raw Materials Increase Plant Throughput Increase Plant Throughput

Immediate focus Medium Term focus Long term focus

  • Full Implementation of Energy

Full Implementation of Energy Projects Projects Consumption optimisation projects Alternative Electricity supply (Other than Eskom) Own electricity generation Substitution of energy sources (e.g. Biogas / PCI)

  • Raw Materials

Raw Materials Coal injection into Corex Pelletising plant

  • Increase throughput to 2 mil t/a

Increase throughput to 2 mil t/a (various options and combinations) Upgrade Conarc Transformer Utilise Namakwa LI TSC increase metallurgical length and EMBR LNG and Midrex Reformer

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Operations overview

10/24/2011 Author 6

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Safety Review 2011 YTD

WHAT WENT WELL WHAT WENT WRONG

1. LTIFR of 0.4 cf budget 1.31 2. FPS Audit outcome: Level 5 on all standards 3. LTI-free hours:

  • 3 million – 2 June 2011 – Record
  • 1 million - 30 Aug 2011

4. Bronze Status on 9 May 2011 5. 86 days without LTI (previous record 280) 6. 43 day tap hole repair LTI free 7. 14 day shutdown at Steelmaking, Strip manufacturing and Water treatment plant injury free 1. 1 x LTI (Blue Cranes) 2. 23 x MAI (3 were RWDC) 3. 84 x FAI 4. Substance abuse remains a problem 5. 10 persons were found in violation of Cardinal Rules

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Safety performance

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TIFR Contractors 0.668 2011 Target: 1.31 AMSA Saldanha 0.000 Combined 0.387

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Liquid steel production

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% Thin gauge production < 1.6mm

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Quality– Prime Ratio (%)

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Focus Areas:

  • Plant stability
  • Skin laminations
  • Edge ripples
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Business Improvement Results Saldanha

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WCM Pillars

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Management Infrastructure

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WCM Vision

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WCM

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BEFORE AFTER

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WCM

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BEFORE AFTER

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WCM

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BEFORE AFTER

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Raw material volumes

Coal 22.4% Coke 3.9% Pellets 17.9% Limestone 3.5% Dolomite 5.3% Iron ore 46.9%

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Fe units make up 62% of raw material volume

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10/24/2011 Author 19

Market

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HRC sales

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158 150 164 156 118 174 139 64 70 46 101 140 121 132 94 92 152 129 62 135 136 108 128 69 48 114 91 100 87 80 116 137 67 104 122 119 106 105

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Export sales per geographic region (2008 - 2009)

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Geographic distribution of Saldanha export sales 2007 & 2008

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50% 38% 1% 21%

NON PRIME / STEPDOWNS THICK GAUGE THIN GAUGE

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Product

  • Hot rolled coil Capability

– Width : 900 to 1524 mm – Thickness : 1.00 to 8.00 mm. – Temper mill Thickness : 4.10 mm max. – Coil weight : 25 mt max

  • Overview of Material grades
  • Saldanha Works currently produces 3 different “chemical grades”. Two of these are very

similar and 99% of material produced conforms to one of these two grades.

  • The grades are :

– LQST10 – a low C low Mn steel (CQ) 47% – LQST50 – a low C, bottom end structural steel. 52% – LQST 20 – a medium carbon steel 1%

  • The strategy was / is to supply Sub Saharan Africa markets with thin commercial quality
  • grades. Premiums for thin gauges are substantial, while the simplified chemical variation

contributes to stability and through put.

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Markets and applications

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Customers Quantity per Month Application Width Thickness 2.00 2.50 3.00 1.20 1.50 1.90 2.40 1.00 1.10 1.15 1.20 1.30 1.40 1.50 1.80 2.00 2 > t < 3.5 50000 14000 30000

Export Market

(Mainly East and West Africa)

Domestic Market DSP

1000 to 1524 1220 1225 1219 Tube and open Profile, small quantity of CTL Cold Rolling Tube and open Profile, CTL not flatness critical

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10/24/2011 Author 25

Looking forward

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Looking forward

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First priority to stabilize operation Stabilize Technology External

Safety Training and Retention

Cost Base Market

Suppliers / Business Partners Maintenance

First priority to stabilize

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Looking forward

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Focus on controlling cost and finding quick payback improvements Stabilize Technology External

Export Focused Thin Strip

Cost Base Market

Optimize in incremental steps

Ensure lowest cost base

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Looking forward

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Expected increase in short term output to come from efficiency gains Stabilize Technology External

Raw materials Energy

Cost Base Market

New technology Higher Throughput

Use technology to open the gap

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Looking forward

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Expected increase in future output to come from efficiency gains

Local vs Export Product Range

Stabilize Technology External Cost Base Market

Thin focus

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10/24/2011 Author 30

Questions