Cleveland-Cliffs Selected to Receive $575 Million in US Department of Energy Investments for Two Projects to Accelerate Industrial Decarbonization Technologies

Cleveland-Cliffs Inc. (NYSE: CLF) announced today that two of its projects have been selected for award negotiations for up to $575 million in total funding from the United States Department of Energy (DOE) to pursue two decarbonization investments at Middletown Works in Ohio and Butler Works in Pennsylvania. Following successful negotiations, these projects will allow for substantial reductions in greenhouse gas (GHG) emissions across the Cliffs’ footprint and will also create efficiencies that meaningfully drive down operating costs while securing and growing good-paying Union jobs. This federal funding is being made available through DOE’s Industrial Demonstrations Program funded through the Infrastructure Investment and Jobs Act and the Inflation Reduction Act.

Middletown Works DRI Plant and Electric Melting Furnaces (up to $500 million grant)

If awarded, the Company would replace its existing blast furnace at its Middletown Works Facility in Middletown, Ohio with a 2.5mtpa Hydrogen-Ready Direct Reduced Iron (DRI) Plant and two 120 MW Electric Melting Furnaces (EMF) to feed molten iron to the existing infrastructure already on site, including the BOF, Caster, Hot Strip Mill, and various finishing facilities. Middletown will maintain its existing raw steel production capacity of approximately 3 million net tons per year and will no longer use coke for iron production. The EMF technology is well established and, together with the injection of hydrogen in blast furnaces, is a preferred route for meaningful reduction in carbon emissions for integrated steelmakers worldwide.

The process will dramatically reduce carbon emissions intensity, and will consolidate Middletown Works as the most advanced, lowest GHG emitting integrated iron and steel facility in the world. The facility will have the flexibility to be fueled by natural gas, which would reduce current ironmaking carbon intensity by over 50%; a mix of natural gas and clean Hydrogen; or clean Hydrogen, which would reduce current ironmaking carbon intensity by over 90%.

Hydrogen demand from this “flex-fuel” DRI plant stands to support DOE’s “Hydrogen Earthshot” and DOE’s Hydrogen hub initiatives.

The new facility is expected to reduce production costs by approximately $150 per net ton of liquid steel produced, or a $450 million annual savings relative to the existing configuration. These savings do not consider any of the premiums expected to be generated from sales of low-carbon steel, such as Cliffs H2 and Cliffs HMAX.