Memorandum of Understanding

Vale and SHS sign MoU to develop decarbonization solutions in steelmaking

06 October 2022

Vale S.A. (“Vale”) and Germany steelmaker SHS-Stahl-Holding-Saar GmbH & Co. KGaA (“SHS”) signed a Memorandum of Understanding (“MoU”) to pursue solutions focused on carbon-neutral steelmaking process.

Vale and SHS intend to jointly study and explore, among other initiatives, (i) the usage of Vale’s green iron ore briquettes and direct reduction pellets in steelmaking; (ii) a briquette plant located close to SHS’ facilities; and (iii) the Tecnored technology.

This initiative contributes to Vale’s commitment to reduce 15% of net Scope 3 emissions by 2035. Since 2021, Vale engaged with around 30 ironmaking clients representing approximately 50% of company’s Scope 3 emissions. Additionally, Vale seeks to reduce its absolute Scope 1 and 2 emissions by 33% by 2030 and achieve net zero by 2050, in line with the Paris Agreement, leading the way to sustainable mining.

About SHS

SHS is an operative management holding that actively assumes tasks for the two steel companies in Saarland, Dillinger and Saarstahl. Dillinger produces steel heavy plates for sectors as steel construction, offshore and line pipes. Saarstahl is a manufacturer of high-quality wire rod and bar for the automotive and general engineering industries. The companies are ready to shape the green transition. The production of green steel is scheduled to start in Saarland in 2027. The new production route will include an electric arc furnace (EAF) at the Völklingen plant and an EAF and direct reduced iron (DRI) plant for the production of sponge iron at the Dillinger plant, in addition to the established blast furnace route.