Middletown Works blast furnace upgrades scrapped as $500M federal grant still under consideration

At the time of Biden’s announcement, the company, one of the oldest in Butler County, said it was looking to the future with $1.8 billion in upgrades that supporters said would add jobs, benefit the environment and ensure long-term stability of the business.

CEO Lourenco Gonclaves said Tuesday that cancelling the plan was spurred by doubts that hydrogen production in the United States will grow fast enough to support the company’s initiative to replace a coal-based blast furnace with a hydrogen-fueled plant.

Founded as Armco Steel in 1900, Middletown Works planned to invest the $500M grant funds and $1.3 billion of its own money over a five-year period to make the upgrades. The plan called for the plant to retire one blast furnace, install two electric melting furnaces and use hydrogen-based ironmaking technology.

The project aimed to eliminate 1 million tons of greenhouse gas emissions each year from the largest supplier of steel to the U.S. automotive industry, the company announced.

Cleveland-Cliffs Inc. (NYSE:CLF) is in talks with the Trump administration to adjust the grant to fit new energy goals, Gonclaves said. The demand for steel in construction and manufacturing is currently reduced because of the U.S. Federal Reserve’s decision not to lower interest rates, he said.