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Steel Industry Acquisitions: Updates Following US Election

As U.S. election results were announced last week, several steel industry players are in the midst of acquisitions that could mean changes for in-house heat treat operators in North America.

Cleveland-Cliffs Expands North American Presence

Lourenco Goncalves
Chairman, President, CEO
Cliffs
Source: Cliffs

Cleveland-Cliffs Inc. (“Cliffs”) today announced that it has successfully completed its acquisition of Stelco Holdings Inc. (“Stelco”). The addition of Stelco enhances Cliffs’ position as the largest flat-rolled steel producer in North America, diversifies Cliffs’ end-markets and expands its geographical presence in Canada. Stelco will continue operations as a wholly-owned subsidiary of Cliffs, preserving the name and iconic Canadian legacy of the business.

Lourenco Goncalves, chairman, president and CEO of Cliffs, stated: “Today marks a transformative step forward for Cleveland-Cliffs. By bringing Stelco into the Cliffs family, we are building on our commitment to integrated steelmaking and good paying union jobs in North America. This acquisition allows us to further diversify our customer base and lower our cost structure. We are excited about the opportunities this acquisition brings and appreciate the warm welcome we have received from all government officials in Canada. We take our permission to operate very seriously and aim to continue the Stelco legacy with dedication and purpose.”

Nothing New: Questions for Nippon-U. S. Steel Acquisition

Takahiro Mori
Vice Chairman and Executive Vice President
Nippon Steel
Source: Nippon Steel

This past April 2024, U. S. Steel was heralding the merger with Nippon Steel as advancing their sustainable steel goals. Still, outgoing President Joe Biden and Vice President Kamala Harris as well as President-Elect Donald Trump and Vice President-Elect JD Vance have all spoken out with concerns to preserve American ownership of U. S. Steel. “And I couldn’t agree more with President Biden,” commented Harris recently along the campaign trail in September, “US Steel should remain American owned and American operated.”

At this time, the U. S. Committee on Foreign Investment has the proposed acquisition under review until late December 2024.

If the deal is approved before the January 2025 inauguration, that does not guarantee that Trump would not overturn the results. However, “The previous Trump administration said it would attract foreign investment and create new jobs,” commented Nippon Steel Vice Chairman and Executive Vice President Takahiro Mori. “This (acquisition) is extremely in line with such a policy.” He still aims to see the deal close before the end of the calendar year.

The press release for the Cliff’s story is available in its original form here.



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US DOE Strategy Affects Heat Treaters

As heat treaters strive for a sustainable future, pressure mounts to make the right choices while running commercially viable operations. This guest column by Michael Mouilleseaux, general manager at Erie Steel, Ltd., explores how and why heat treat operations are now coming under the focus of the U.S. Department of Energy.

This informative piece was first released in Heat Treat Today’s March 2024 Aerospace print edition.


The iron and steel industry contributes approximately 2.1% of energy-related CO2 emissions from primary sectors in the U.S. These statistics may seem insignificant or far removed, but the federal government has now determined that heat treating is a significant contributor and has set in motion critical changes for U.S. heat treaters.

Background

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On December 8, 2021, President Joe Biden issued an executive order that committed the federal government to “lead by example” in U.S. efforts towards carbon-free and net zero emissions solutions. Since then, the executive has delegated the Department of Energy (DOE) and the Environmental Protection Agency (EPA) to spearhead these initiatives aimed at reducing greenhouse gas emissions (GHGE) and promoting energy efficiency across various sectors of the U.S. economy. To support these efforts, $10,000,000,000 in incentives are being allocated for the DOE and EPA to investigate and promulgate regulations.

Specifically, the government sees the “industrial sector” as responsible for close to a quarter of all greenhouse gas emissions (GHGE); the five industries named within this sector are chemical processing, petroleum processing, iron & steel production, cement production, and food & beverage manufacturing. The DOE is leading the efforts of “supercharging industrial decarbonization innovation” and leveraging the potential of “clean hydrogen.”

Following these directives, the DOE unveiled the “Industrial Decarbonization Roadmap” in September 2022. This strategic plan will guide decarbonization efforts of the five key industrial sectors to mitigate GHGE. The four pillars are:

  • Energy efficiency
  • Industrial electrification (using green electricity)
  • Adoption of low-carbon fuels, feedstocks, and energy sources (LCFFES)
  • Carbon capture, utilization, and storage at the generated source (CCUS)

The DOE determined that process heating — accounting for 63% of energy usage within the iron and steel industry — would be the best opportunity to apply these four pillars. However, until May 2023, heat treating had not been explicitly mentioned as a target for decarbonization efforts.

Why Should Heat Treaters Care?

In May 2023, the Industrial Efficiency & Decarbonization Office — an office within the DOE’s Office of Energy Efficiency & Renewable Energy — held a symposium to refine its commitment to the decarbonization of the industrial sector. It was then that heat treating was specifically defined as a process targeted for the reduction of GHGE in the steel, aluminum, and glass manufacturing industries.

The DOE’s refined commitment focuses on two things: reduce GHGE attributable to “process heating” by 85% by 2035 and achieve net-zero CO2 emissions by 2050. To reach these ambitious goals, the DOE emphasized the importance of adopting LCFFES, green electrification, and implementing strategies that promote industrial flexibility, advanced heat management, smart manufacturing, and alternative technologies.

The potential ramifications of the DOE’s efforts on the heat treating industry are momentous. With the development of regulations to support these efforts, businesses within this sector must prepare for significant changes. The focus on green hydrogen, biofuels, and electrification, coupled with advanced technological solutions like ultra-efficient heat exchangers, artificial intelligence, machine learning, and alternative no-heat technologies, are strategies being considered for potential regulation.

Conclusion

The heat treating industry stands at a crossroads, with the DOE’s decarbonization initiatives signaling a shift to adopt cleaner energy practices. As these regulations take shape, businesses will need to adapt, investing in new technologies and processes that align with the nation’s clean energy goals. In the next column, we’ll address potential ramifications of the DOE effort for industrial decarbonization in the heat treating industry to help you be better informed and prepared.

About the Author:

Michael Mouilleseaux
General Manager at Erie Steel, Ltd.

Michael Mouilleseaux is general manager at Erie Steel, Ltd. He has been at Erie Steel in Toledo, OH since 2006 with previous metallurgical experience at New Process Gear in Syracuse, NY, and as the director of Technology in Marketing at FPM Heat Treating LLC in Elk Grove, IL. Michael attended the stakeholder meetings at the May 2023 symposium hosted by the U.S. DOE’s Office of Energy Efficiency & Renewable Energy. He will be speaking on the MTI podcast about this subject on March 5, 2024, 2:30 EST, and will present on this topic at the April 3, 2024, MTI Mid-West chapter meeting.

For more information: Contact Michael at mmouilleseaux@erie.com.

Attend the SUMMIT to find out more about the DOE’s actions for the heat treat industry.

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United States Air Force in UK Receives Aerospace Furnace and Heat Treat Training

HTD Size-PR LogoUnited States Air Force personnel stationed at Royal Air Force (RAF) Base Mildenhall in the United Kingdom recently commissioned and received full training on the use and maintenance of a heat treating furnace for aerospace parts. The furnace will help maintain KC-135, CV-22, C-130 aircraft, and F-15 fighter jets assigned to RAF Mildenhall or nearby RAF Lakenheath air stations. The installation was interrupted by an impromptu visit from the U.S. President.

Richard Conway
Chief Technology Officer
Delta H Technologies

The DELTA H® TECHNOLOGIES dual chamber heat treating furnace for aerospace (DCAHT®) was designed by the supplier to rapidly heat treat all common aviation grade metals and alloys necessary for aircraft maintenance and is fully compliant with USAF/NAVAIR Tech Order 1-1A-9 and SAE-AMS2750F. The training received by the USAF airmen at RAF Mildenhall included essential instructions in heat treating, as well as furnace calibration practices like temperature uniformity surveys (TUS) and system accuracy tests (SAT) and culminated with each airman receiving Certificates of Training.

The specialized furnace features an upper chamber convection system, 18" wide x 12" high x 48" deep, capable of Class 1 (+/-5°F) from 200°F to 1200°F and a lower chamber radiant heat system, 12" wide x 12" high x 36" deep, capable of Class 3 (+/-15°F) from 1000°F to 2000°F with air or argon atmosphere. A roll-away quench tank features dual baths for water and oil quenchant. The controls and data acquisition provide detailed batch records of heat treated parts, including quench delay, as well as automatic tracking of thermocouple usage and calibration intervals.

Air Force One at RAF Mildenhall

The training was interrupted by an unexpected visitor to RAF Mildenhall. The hangar next to the Metals Tech Shop, where the furnace was being commissioned and the training was being conducted, was the epicenter for the arrival of a top-secret VIP. When the Air Force Band began practicing "Hail to the Chief," it became obvious that U.S. President Joe Biden would be making an unexpected visit to the base. While the President’s visit was not related to the furnace commissioning, Richard Conway, DELTA H® founder and chief technology officer, and wife Mary Conway, witnessed this presidential visit and got a few candid photographs of Air Force One (see above).

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