The world’s most reliable and productive Direct Reduction Technology

The MIDREX® Process

forSolutions Steelmakers

INTRODUCTION The growth and increasing sophistication of the world steel industry has created an escalating demand for higher quality iron products. Over the past four decades Midrex Technologies, Inc. has risen to the occasion by supplying the industry with the world’s most reliable and productive Direct Reduction Technology: The MIDREX® Process.

“Midrex is a technology company founded on the pursuit of innovation and is dedicated to continuous improvement especially in the iron and steel industry.” - Don Beggs, inventor of the MIDREX® Process

The MIDREX® Process is the best industry example of this philosophy and its proven results. Plants using the MIDREX Process are the world’s largest, most flexible and longest running Direct Reduction (DR) plants. Product quality and flexibility to produce various forms of iron together with some of the best production records industry-wide make MIDREX® Plants the most profitable DR plants in the world to own and operate. Midrex builds DR plants that work day in and day out, year after year to provide value for our clients. We provide dependable solutions so our clients can make the most of their investment and maximize their profits for years to come.

CONTENTS

2 INTRODUCTION

3 THE RISE OF DIRECT REDUCED IRON

4 APPLICATIONS FOR MIDREX® DRI PRODUCTS

5 MIDREX® DRI FOR ELECTRIC ARC FURNACES

6 MIDREX® DRI FOR INTEGRATED MILLS

7 MIDREX® DIRECT REDUCTION PROCESS

9 MIDREX® SHAFT FURNACE

11 FEED MATERIALS

12 REDUCING GAS

17 HOT TRANSPORT OF DRI TO EAF

19 PLANT PERFORMANCE

20 VALUE OF MIDREX

21 MIDREX® PLANTS

1 The MIDREX® Process CONTENTS INTRODUCTION The MIDREX® Process 2

The MIDREX® Process

ENVIRONMENTAL ASSURANCEMidrex Technologies, Inc. along with its parent company Kobe Steel, Ltd., recognizes the importance of protecting the environment and conserving natural resources. Through the years we have been proactive in increasing efficiency and productivity while reducing the environmental impact of our processes.

MIDREX® Plants are designed to minimize water, noise and air pollution. MIDREX® Plants meet applicable World Bank standards and more importantly, Midrex can and will provide DR Plants designed to meet any local emissions or environmental standards regardless of location.

3 The MIDREX® Process THE RISE OF DIRECT REDUCED IRON

THE RISE OF DIRECT REDUCED IRON

DRI is premium iron that is made from oxide by removing chemically bound oxygen from the iron without melting. It is a metallic low in residual metals and nitrogen. It has been used for making almost every form of steel product from all types of sheets up to and including exposed auto body steels, extra deep drawing quality steels, wire and fine wire products, spe-cial bar quality, forging bar quality and seamless tube products.

DRI products are a staple of the electric arc furnace (EAF) industry and have found increasing usage in integrated mills to improve their productivity and lower fuel consumption.

Its purity allows EAFs to produce steels that were historically considered to be solely within the domain of oxygen furnace steelmaking. Prior to the application of DRI, EAF’s had ex-treme difficulty making these products because of the very limited supply of low residual, high grade scrap steel that could be sourced to feed to these EAF’s.

With the advent of the thin slab caster (TSC) in the early 1990’s, a renewed appreciation arose for the purity of DRI and its usefulness in making sheet steels. This caused DR plants to be built to supply iron for the EAF/TSC mills.

A MIDREX® Plant can feed a single EAF or various combina-tions of EAFs and integrated complexes supplementing Blast Furnace (BF) and Basic Oxygen Furnace (BOF) operation. A single Super MEGAMOD® MIDREX® Plant is well-suited to feed EAFs to replace a blast furnace/BOF complex. A MIDREX® Plant is also an excellent alternative to importing large quantities of scrap steel or to building a high cost blast furnace complex.

MIDREX® DRI products are high quality metallic, low in re-sidual metals, that dilute undesirable elements contained in other charge materials. High metallic iron content, adjustable carbon levels and consistent chemical and physical character-istics provide steelmakers broad flexibility in selecting their furnace charges, along with the ability to produce higher quality steels than possible with scrap alone.

RECENT YEARS HAVE SEEN AN EVER INCREASING NEED WORLDWIDE FOR METALLICS, SPECIFICALLY DIRECT REDUCED IRON (DRI) IN ITS VARIOUS FORMS TO FEED THE STEEL INDUSTRY.

SINCE 1970, WORLD DRI CONSUMPTION HAS GROWN BY ALMOST 100-TO-1, A REMARKABLE RECORD BY A RAPIDLY GROWING INDUSTRY. CONTINUED GROWTH IS EXPECTED AT A STEADY PACE.

APPLICATIONS FOR MIDREX® DRI PRODUCTS

APPLICATIONS FOR MIDREX® DRI PRODUCTS The MIDREX® Process 4

CDRIDRI PRODUCTS CDRI HBI HDRI

TYPICAL CHARACTERISTICS OF MIDREX IRON

MIDREX® Plants commonly produce DRI products with metallization levels up to 97%, and metal-lization is controllable independent of other major product parameters.

Pellet & lump

Ambient

EAF & BOF

Continuous & Batch

CDRI (Cold DRI) is a high quality metallic ideal for use in a nearby EAF. It can also be transported via rail to another site when proper precautions are made. It is not recommend-ed for ocean transport.

Inerting (N2) or passivation REQUIRED for cargo during the transport

50

Pellet & lump

550° C or Higher

EAF

Continuous & Batch

HDRI (Hot DRI) is discharged hot from the shaft furnace and transported to an EAF for melting and provides the optimum way for DRI users to increase productivity and reduce cost.

N/A

7

Briquettes* (density ≥ 5.0 grams per cubic centimeter (g/cc)

Ambient

EAF, BOF & BF

Continuous & Batch

HBI (Hot Briquetted Iron) is a premium form of DRI and is the industry and regulatory preferred method of preparing DRI for long term storage and transport. HBI is commonly used in EAFs and can also be added to the Blast Furnace and BOF.

No Special Precautions

12

* The MIDREX® Process requires less oxide coatings than competing DR technologies, which allows for easier briquetting of DRI and stronger physical HBI characteristics.

Fe Total (%)

Fe Metallic (%)

Metallization (%)

Carbon (%)

P* (%)

S* (%)

Gangue* (%)

Mn, Cu, Ni, Cr, Mo,

Sn, Pb, and Zn (%)

Bulk Density (kg/m3)

(lbs/ft3)

Apparent Density (g/cm3)

Product Temperature (° C)

Typical Size (mm)

*Depends on iron ore source

90 – 94

83 – 90

92 – 97

1.0 – 3.0

0.005 – 0.09

0.001 – 0.03

2.8 – 6.0

trace

1,600 – 1,900

100 – 120

3.4 – 3.6

40

4 - 20

CDRI90 – 94

83 – 90

92 – 96

0.5 – 1.5

0.005 – 0.09

0.001 – 0.03

2.8 – 6.0

trace

2,400 – 1,900

150 – 175

5.0 –5.5

80

30 x 50 x 110

HBI90 – 94

83 – 90

92 – 96

1.0 – 3.0

0.005 – 0.09

0.001 – 0.03

2.8 – 6.0

trace

1,600 – 1,900

100 – 120

3.4 – 3.6

600 – 700

4 - 20

HDRI

Product Form

Product Temperature

Where used

Charging Method

Description:

IMO Restrictions for transport

Number of MIDREX® Plantscurrently in operation

Degree of Metallization, % = [( % Metallic Fe)/( % Total Fe)] x 100

5 The MIDREX® Process MIDREX® DRI FOR ELECTRIC ARC FURNACES

Even though DRI use is often associated with the production of high grade, low residual metal, low nitrogen products, most of the product is actually used to make common grades of long products, reinforcing bar and light structural prod-ucts. This is simply because in many locations there is not enough scrap steel available and local demand for these light construction steels is sufficient to justify building of an EAF mini-mill. In such a location, a MIDREX® Plant is an excellent alternative to importing large quantities of scrap steel or to building a high cost blast furnace complex.

The benefits of DRI products are not limited to their chemical characteristics. In an EAF, DRI products can be either batch or continuously charged.

In batch charging, the use of high bulk density DRI/HBI can eliminate the need for a second or third scrap charge. This results in lower energy losses, more power on-time and improved productivity. Midrex DRI or HBI is mixed with scrap in the bucket. Generally, DRI or HBI can be added at up to 30 percent of the charge.

Continuous charging systems can be used to feed up to 100 percent of the required metallics. More commonly, one bucket of scrap is charged and the remainder is continuously fed CDRI, HBI or HDRI. This can reduce the number of batch charges and allows the furnace roof to stay on, retaining valuable heat. Maintaining a consistent temperature leads to improved bath heat transfer and faster metallurgical reactions. HDRI can be charged directly using the MIDREX HOTLINK® System, the hot conveyor-based Hot Transport System developed by Midrex and Siemens VAI or by hot transport vessels. HDRI usage reduces operating cost and increases productivity.

THE GREATEST USER OF DRI PRODUCTS IS THE EAF STEELMAKING INDUSTRY.

MIDREX® DRI FOR ELECTRIC ARC FURNACES

• Increases EAF productivity by 15-20% or higher

• Decreases EAF electricity requirements by at least 120-140 kWh/t liquid steel

• Decreases EAF electrode consumption by at least 0.5-0.6 kg/t liquid steel

• Decreases EAF refractory consumption by at least 1.8-2 kg/t liquid steel

MIDREX® DRI FOR INTEGRATED MILLS The MIDREX® Process 6

MORE THAN TEN PERCENT OF THE HBI SHIPPED OVERSEAS IS BOUND FOR USE IN BLAST FURNACES, MOSTLY IN NORTH AMERICA AND IN WESTERN EUROPE. HBI CAN HELP REDUCE BLAST FURNACE EMISSIONS WHILE INCREASING PRODUCTIVITY. HBI IS ALSO OFTEN USED IN BASIC OXYGEN FURNACES AS A COOLANT.

MIDREX® DRI FOR INTEGRATED MILLS

BLAST FURNACEIntegrated works employ HBI in their blast furnaces to remarkably increase hot metal production and lower coke consumption. HBI may be used for up to 30% of the blast furnace charge with no requirement for additional capital expenditure.

Its use is cost effective when the steelworks is hot metal short, or if a blast furnace is down for a reline or idled until hot metal demand increases. Use of HBI also decreases CO2 generation. Practiced mostly in North America and in Western Europe, it is used for two main reasons. One is to routinely increase the pro-duction from a specific blast furnace, to either increase the steel output from a works or to allow for the closure of a smaller, older, less efficient blast furnace. The other is to raise the output of a blast furnace while another blast furnace is taken down for maintenance.

BASIC OXYGEN FURNACEA common practice is to use HBI as a cold charge in the BOF to supplement scrap. It can be loaded in the charging box and charged and melted like scrap. In cases where scrap has high levels of residual metals, HBI is a preferred charge material. This practice is most common in areas where supplies of prime grades of scrap steel, relative to demand, are readily available.

Melting Benefits of HDRI in EAF

Perc

ent i

ncre

ase

in p

rodu

ctiv

ity

Percent of iron charged as metallic iron

00 10 20 30 40 50

10

20

30

40

EFFECT OF CHARGING METALLIC IRON INTO A BLAST FURNACE - PRODUCTIVITY INCREASE

Flexibility of MIDREX® Plants

MIDREX® Plants are designed to meet the specific requirements of each client and can do so because the MIDREX Process allows for the broadest selection of proven process options.

MIDREX Plant capacities range from 0.5 million tons per year to more than 2.5 million tons per year and provide a wide range of product combinations that include CDRI, HBI and multiple ways to charge HDRI. This allows users to create the plant best suited for their project and site-specific requirements, providing greater flexibility for the needs of captive use or merchant sale.

MIDREX Plants may be sized to support the Client’s needs whether that need is to provide a partial or total charge for EAF(s), for Blast Furnace(s), for Basic Oxygen Furnace(s) or for merchant purposes (sales to other steel works). Only MIDREX Plants have proven performance in this regard.

Midrex is proud to be the leader in this field with plants making more than 60% of total worldwide DRI production. In addition more than 80% of all DRI products made with natural gas as the fuel are made by MIDREX Plants. The steel industry will need more and more clean sources of iron and Midrex will be at the forefront, always developing new and ever more efficient and profitable technologies.

OVERCOMING TECHNICAL, COMMERCIAL AND GEOGRAPHICAL CHALLENGES IS MIDREX’S SPECIALTY, AND IS A MAJOR FACTOR AS TO WHY THE MIDREX® PROCESS IS THE WORLD’S LEADING TECHNOLOGY FOR PRODUCING DIRECT REDUCED IRON.

MIDREX® DIRECT REDUCTION PROCESS

GROWTH OF MIDREX CAPACITY

7 The MIDREX® Process MIDREX® DIRECT REDUCTION PROCESS MIDREX® DIRECT REDUCTION PROCESS The MIDREX® Process 8

Mill

ion

Tons

/Yea

r

0

0.5

1.0

1.5

2.0

2.5

3.0

Series 400

Series 600

MEGAMOD

SUPER MEGAMOD

Prototype

Plant Size

• Combination plants allow for simultaneous discharge of HDRI and CDRI or HBI as determined by EAF operation and market conditions.

• The MIDREX® Plant can continue operation when EAF is offline.

• Use of proprietary SIMPAX® Software for process automation and HDRI quality prediction enables plant operators to optimize plant availability, efficiency and productivity.

For more than 40 years, Midrex has produced reliable ironmaking technologies. Our shaft furnace-based MIDREX® Process provides an efficient way to reduce iron oxide with the greatest operational flexibility. MIDREX® Plants are the industry’s largest, most efficient and most profitable producers of CDRI, HBI and HDRI.

FEED MATERIALS

ENERGY SOURCES REDUCING GAS

PRODUCTOPTIONS

HDRI& HBI

HDRI& CDRI

CDRI & HBI

HBICDRI

Lump OrePellets

MIDREX®

Shaft Furnace

CoalPet Coke

COREX®

CoalPet Coke

Refinery BottomsGasifier

Coke OvenGas (COG)

Thermal ReactorSystem™

Natural Gas

Steam Reformer

MIDREX® SynRG™ Reformer

Plant

®

NG Plant

®

PlantCOREX® /

MIDREX® DIRECT REDUCTION PROCESS FLEXIBILTY

THE MIDREX® PROCESS USING THE MIDREX® SHAFT FURNACE CONVERTS IRON OXIDE IN PELLET OR LUMP FORM INTO HIGHLY METALLIZED DIRECT REDUCED IRON THAT CAN BE DISCHARGED EITHER HOT OR COLD WITH UNIFORM PRODUCT QUALITY. COMBINATIONS OF CDRI, HDRI OR HBI CAN BE PRODUCED SIMULTANEOUSLY WITHOUT DISRUPTION TO PRODUCT DISCHARGE.

Most naturally occurring iron ore exists as hematite (Fe2O3), and contains about 30% oxygen by weight. In the MIDREX® Process, the chemically bonded oxygen in the iron ore is removed using a high temperature reducing gas composed of hydrogen (H2) and carbon monoxide (CO) to produce metallic iron (Fe).

The direct reduction of the iron oxide occurs inside the MIDREX® Shaft Furnace, a cylindrical refractory lined vessel. Iron oxide is fed from the top and DRI is discharged at the bottom allowing for consistent even flow assuring uniform reduction.

• Iron Oxide pellets and/or lump are fed to top of furnace and flow downward.

• Iron Oxide is heated and converted to DRI by a high temperature reducing gas.

• Products can be discharged hot or cold in combinations that include CDRI, HBI or HDRI

Pre Heat

Reduction

Transition

Product Discharge

REACTIONS WITHIN THE MIDREX® SHAFT FURNACE

3Fe2O3 + CO 2Fe3O4 + CO2 Exothermic Reduction by CO

3Fe2O3 + H2 2Fe3O4 + H2O Exothermic Reduction by H2

Fe3O4 + CO 3FeO + CO2 Endothermic Reduction by CO

Fe3O4 + H2 3FeO + H2O Endothermic Reduction by H2

FeO + CO Fe + CO2 Exothermic Reduction by CO

FeO + H2 Fe + H2O Endothermic Reduction by H2

3Fe + CH4 Fe3C + 2H2 Endothermic Carburizing Reaction

3Fe + 2CO Fe3C + CO2 Exothermic Carburizing Reaction

3Fe + CO + H2 Fe3C + H2O Exothermic Carburizing Reaction

REACTION HEAT DESCRIPTION

MIDREX® SHAFT FURNACE

9 The MIDREX® Process MIDREX® SHAFT FURNACE MIDREX® SHAFT FURNACE The MIDREX® Process 10

MIDREX® SHAFT FURNACEHot, high quality reducing gas is introduced into the burden where the metallization is highest and then passes through the burden in counter-flow to the descending solids (iron oxide being converted into metallic iron). This maximizes both the chemical efficiency and thermal efficiency of the gas.

Midrex pioneered the application of this design for direct re-duction. Our long and extensive experience, that has produced 650 million tons of DRI to date, has been used to steadily improve the technology and continues to inspire innovation.

The H2 and CO reducing gas can be produced one of several ways depending on the fuel source available (more details on this follows in the Reducing Gas section starting on page 12).

Carbon dioxide (CO2) and water vapor (H2O) are byproducts of the iron oxide reduction reactions.

CARBON IN DRI PRODUCTSCarbon content of DRI Products can be critical when used in the EAF. One reason is that DRI by its very nature is less than 100% metallized, and carbon is necessary to complete the metallization of the iron in the EAF. Carbon is also a supplemental way to provide energy to the EAF and for the formation of foamy slag. Too little carbon requires that additional carbon be added to the EAF for these purposes; however, too much carbon requires additional oxygen be added to burn off the surplus. This means longer power on times and longer tap-to-tap times for the EAF and loss of Fe, resulting in lower productivity.

The range of carbon needed is directly related to the metallization and amount of DRI charged in relation to the amount and quality of the scrap also in the charge. Based on comprehensive and exhaustive modeling and testing, the world’s leading EAF Technology Suppliers have determined that the optimum content should range from 2.0% to 2.7% when the EAF is charged with 100% HDRI. Slightly higher carbon levels in the DRI may be preferable when CDRI is used as all, or part of the DRI Product charge to the EAF.

Flexibility to produce variable amounts of carbon can be instrumental to optimum operation. MIDREX® Plants are unique in their ability to control DRI Product carbon levels from 0.5% to 3.0% independent of other parameters unlike other competing processes.

THE OVERALL REDUCTION REACTIONS ARE:Fe2O3 + 3H2 2Fe + 3H2OFe2O3 + 3CO 2Fe + 3CO2

Iron Oxide Charging

H2

H2O

CO2

CO

FeFeO

11 The MIDREX® Process FEED MATERIALS REDUCING GAS The MIDREX® Process 12

The process handles a diverse array of feed materials including low grade high sulfur ores in both pellet and lump forms. The typical characteristics for widely traded DR-Grade pellets and lump ores are often dictated by the requirements of the steel plant to maximize productivity.

MIDREX Plants often use lower quality iron ore, even Blast Furnace grade pellets depending on the cost of raw materials and the economics of the Steel Mill.

Midrex has a comprehensive testing program that evaluates existing raw material sources and investigates new ones. The Midrex Research and Technology Development Center is fully equipped to assess the suitability of pellets and lump ores for direct reduction use. Midrex works with iron oxide suppliers to develop new and improved sources of raw materials and with plant operators to evaluate sources for their needs.

FEED MATERIALS

CHEMICAL CHARACTERISTICS

Pellets Lump

Fe (%) 67.0 67.0

SiO2 + Al2O3 (%) 3.0 3.0

S (%) 0.008 0.008

P (%) 0.03 0.03

TiO2 (%) 0.15 0.15

PHYSICAL CHARACTERISTICS

Pellets Lump

Nominal Size 6 x 16 mm 10 x 35 mm

10 x 35 mm (%) — 85 min.

9 x 16 mm (%) 95 min. —

Minus 5 mm (%) 3 max. 5 max.

Compression Strength (kg) 250 min. —

Less than 50 kg (%) 2 max. —

REDUCTION CHARACTERISTICS

Pellets Lump

Midrex Linder Test (760° C)

Metallization (%) 93 min. 93 min.

Minus 3.36 mm (%) 2 max. 5 max.

Hot Load Test (815° C)

Tumble Strength (% plus 6.73 mm) 90 min. 85 min.

Compression Strength (kg) 100 min. —

Clustering (% plus 25 mm after 10 rev.) 0 0

FEEDSTOCK OPTIONS

Lower quality iron ores are often used in MIDREX® Plants depending on the cost of the raw materials and the impact of down stream steelmaking operations. The Midrex Materials Testing Lab can evaluate all types of iron oxide pellets and lump ore to determine suitability for Direct Reduction.

PELLETS

LUMP

TYPICAL CHARACTERISTICS OF DR-GRADE PELLETSAND LUMP USED IN EAF STEELMAKING

VARIOUS FUEL SOURCES INCLUDING NATURAL GAS, COAL, COKE OVEN GAS AND PROCESS SYNGAS CAN BE USED TO CREATE A SUITABLE REDUCING GAS FOR THE MIDREX® PROCESS.

THE MIDREX® PROCESS IS DESIGNED TO OPERATE WITH VIRTUALLY ANY BLEND OF PELLETS AND LUMP ORES. MIDREX® PLANTS HAVE PROCESSED IRON OXIDE PELLETS AND LUMP ORES OF VARYING QUALITY FROM MORE THAN 50 SOURCES AROUND THE WORLD.

REDUCING GAS

Reducing gas can be produced using natural gas through a traditional steam reformer or the unparalleled stoichiometric MIDREX® Reformer. When the source is coal including high sulfur coals or Coke Oven Gas (COG), Midrex uses the MXCOL® flowsheet by means of either a gasifier or Thermal Reactor System™ (more on page 15). Reducing gas can also be produced from the off gas generated by COREX® or FINEX® Plants. An important property of the reducing gas is the reductant / oxidant ratio, or “gas quality.” The gas quality is a measure of the potential for the gas to reduce iron oxide. The higher the gas quality the lower the volume of gas required to react with the iron; pushing less gas means the process is more efficient.

Natural Gas MIDREX® Reformer 1.5 to 1.7 Since 1969

Natural Gas FMO (formerly OPCO) 3.2 to 3.9 1990

COREX® Offgas Arcelor Mittal South Africa CO2 Removal + Heater 0.3 to 0.4 1999

COREX® Offgas JSW Projects Limited CO2 Removal + Heater 0.5 to 0.6 Construction

Coal Gasifier JSPL Angul I CO2 Removal + Heater 2.0 Construction

Energy Source MIDREX® Plant Reference Reducing Gas Train Reducing Gas H2:CO Start-up

More than 60 modulesin operation

Steam Reformer, Heater + MIDREX® Reformer

MIDREX® Process Energy Source Flexibility

ArcelorMittal South Africa PlantCOREX®/MIDREX®

Comsigua MIDREX® Plant, VenezuelaHadeed Module E MIDREX® Plant, Saudi Arabia

FMO Planta de Briquetas (formerly OPCO)Venezuela, Using Steam Reformers

JSPL Angul I, India - Under ConstructionMXCOL® Coal Gasifier

Gas Quality = (% H2 + % CO) / ( % H2O + % CO2)

13 The MIDREX® Process REDUCING GAS REDUCING GAS The MIDREX® Process 14

MIDREX® REFORMER Midrex designed and built the world’s first commercial high temperature, stoichiometric CO2 reformer. This concept is unique to the MIDREX Process and enables the production of a high quality reformed gas that can be fed directly to the direct reduction shaft furnace.

The MIDREX Reformer converts recycled offgas from the MIDREX® Shaft Furnace plus fresh natural gas into hydrogen (H2) and carbon monoxide (CO).

Natural gas plus recycled top gas is heated in a refractory lined furnace and catalytically reformed. The use of recycled gas and the ability to feed hot reformed gas to the shaft furnace without quenching and reheating provide for a very efficient process.

Unique to the MIDREX Process specifically due to the MIDREX Reformer is the recycle of waste CO2 from the reduction furnace creating an additional reaction of CH4 + CO2 to produce 2H2 and 2CO.

CH4 + H2O CO + 3H2 (H2O reforming)

CH4 + CO2 2CO +2H2 (CO2 reforming)

The MIDREX Reformer eliminates the need for a separate CO2 removal system as it reforms the CO2 to CO and it also completely eliminates the need for a process gas re-heater.

SynRG® REFORMER Through continuous innovation and commercial application, Midrex has introduced its next genera-tion MIDREX® SynRG® Reformer that provides even greater efficiency of operation and lower capital expenditure.

The SynRG® Reformer features lower NOx burners, new catalyst composition and configuration, revolutionary new tube metallurgy and a new footprint.

To date Midrex has supplied more than 70 MIDREX® Reformers for projects around the world. The largest MIDREX® Reformers produce nearly 400,000 Nm3/hr of reducing gas, enabling the production of more than 2.0 million tons per year of DRI. Even larger units are available.

STEAM REFORMERThe optimum way to use natural gas to produce reducing gas is to use a MIDREX® Reformer; however, MIDREX has produced reducing gas with a conven tional steam reformer such as used in the petro-chemical industry.

One such example is the FMO Planta de Briquetas (formerly OPCO) in Puerto Ordaz, Venezuela. This MIDREX® Plant started up in 1990 using an existing steam reformer originally supplied for another process technology.

The FMO Plant decided to increase capacity in the 1990s. A number of options were studied and eventually it was decided that best solution was to augment the steam reformer by adding a small MIDREX® Reformer. The MIDREX Reformer began operation in 1996 with the steam reformer and increased the capacity of the plant to more than one million tons of HBI per year.

Top GasTop Gas Fuel

Natural Gas

ScrubberMIDREX®

ShaftFurnace

MIDREX®

Reformer

Product

Reducing Gas

Iron Ore

MIDREX® PROCESS FUELED BY NATURAL GAS MIDREX REFORMER®

REDUCING GAS

FMO Planta de Briquetas (formerly OPCO) Puerto Ordaz, Venezuela

THE MIDREX® REFORMER

• Refractory lined furnace with catalyst tubes through which gas flows upward

• Combined CO2 removal and heater in one step

• Natural gas plus recycled top gas (feed gas) is catalytically reformed

• Reducing gas is approximately 90% (H2 + CO), at temperatures of 900-950° C , and used without quenching and without reheating

NATURAL GAS IS THE CLEANEST, GREENEST FUEL FOR PRODUCTION OF DRI.

USING NATURAL GASTo create reducing gas from natural gas, the natural gas must first be reformed into hydrogen (H2) and carbon monoxide (CO). The MIDREX® Process typically uses natural gas as the reductant and fuel by means of the unique MIDREX® Reformer.

Reducing Gas

Flue Gas

Feed Gas

Fuel Gas andCombustion Air

Reformer Tubes with Catalyst

TYPICAL COMPOSITION INLET OUTLET

H2 35 55

CO 19 35

CO2 15 2

H2O 13 6

CH4 17 1

N2 1 1

Temp. (°C) 580 980

REDUCING GAS The MIDREX® Process 16

The benefit is that it produces very high quality syngas regardless of the quality of the fuel.

Possible feedstocks include coal, lignite, pet coke and other petroleum refinery bottoms. As energy costs rise, gasification enables the use of lower quality coals or waste prod-ucts to produce energy.

MXCOL® GASIFIER SYNGAS SOLUTIONGasification refers to the reaction of coal or other solid or liquid carbonaceous feedstock with oxygen to produce a synthesis gas (syngas). As opposed to combustion, in which air or oxygen produces CO2 and water, gasification uses lesser amounts of air or oxygen to produce H2 and CO.

Commercially available gasification technology can be paired with a MIDREX® Shaft Furnace through MXCOL® to produce DRI. The designs include gas-cleaning and conditioning systems to provide a reducing gas suitable for direct reduction. After cleaning and conditioning, the gas is reheated to the proper temperature and introduced to the furnace. After scrubbing and CO2 removal, the offgas is recycled with fresh syngas.

COREX® OFFGASThe world’s first application of coal gasification to produce DRI in a MIDREX® Plant started up in 1999 at ArcelorMittal Steel South Africa (formerly Saldanha Steel). This is known as the COREX®/MIDREX® Process.

This facility includes a COREX® Plant, supplied by Siemens VAI, which uses a melter/gasifier to simultaneously produce hot metal and a by-product synthesis gas that feeds a MIDREX MEGAMOD®

Shaft Furnace.

REDUCING GAS

MXCOL® (PRONOUNCED “M-X-COAL”) IS THE NAME AND TRADEMARK FOR THE COMMERCIALLY PROVENMIDREX® SHAFT FURNACE TECHNOLOGY THAT USES SYNGAS DERIVED FROM COAL.

USING COALMXCOL® can receive syngas from many sources including commercial gasifiers (using high or low quality coals or other alter-native fuels) and the new Thermal Reactor System™ (technology using an innovative partial oxidation system). The MIDREX® Shaft Furnace can also use the off gas of the coal-based COREX® Hot Metal Process from Siemens VAI Metals Technologies.

O2

Recycle Gas

GasHeater

GasCleaning &

ConditioningCO2

Removal

AirSeparation

Plant

Iron Oxide

Turbo Expander

CoalPet Coke

Refinery Bottoms

MIDREX®

Shaft Furnace

DRI / HBI / HDRIMIDREX® PlantGasification Plant

Gasifier

Syngas

MXCOL® GASIFIER OPTION

Scrubber

Scrubber

O2

Recycle Gas

Hot MetalSlag

Top Gas

Coal

GasHeater

GasifierMelter

CO2Removal

Iron Oxide

Additives/Ore/Pellets

COREX®

ExportSyngas

MIDREX®

Shaft Furnace

DRI / HBI / HDRI

MIDREX® PlantCOREX® Plant

ReductionShaft

COREX®/ MIDREX® OPTION

Scrubber

MXCOL® COKE OVEN GAS (COG) SOLUTION Coke ovens produce coke for use in blast furnaces and generate an offgas containing H2 and CO. This gas is used typically for feedstock to chemical plants, heating applications and production of electricity, but chemically can have more economic value to the steelmaker to create additional iron units.

The MXCOL® option for using coke oven gas (COG) incorporates a new Thermal Reactor System™ from Midrex Technologies, Inc. and Praxair, Inc. This unique technology utilizes partial oxidation to reform the COG gas for use in the MIDREX® Process to produce DRI, HBI or HDRI. When the coke ovens are located on the site of an inte-grated blast furnace steel works, HBI produced by the MIDREX Process can be used onsite to in-crease the capacity of the blast fur-nace. HBI is used on an increasing basis to provide alternate feed ma-terial for blast furnace operations. Some operators feed up to 30% HBI to their blast furnace on a con-sistent basis to improve its perfor-mance and reduce environmental emissions.

O2

Recycle Gas

Reducing Gas

Scrubber

GasHeater

COGPre-Heater

ThermalReactor

CO2Removal

AirSeparation

Plant

Iron Oxide

DRI / HBI / HDRI

DRI / HBI / HDRI

MIDREX® PlantThermal Reactor System™

Integrated Mill

CleanCoke Oven Gas

(COG)

COG

Syngas

MXCOL® COG OPTION

MIDREX®

Shaft Furnace

Coke Oven

Coke

Blast Furnace

Hot Metal

HBIIron Oxide

Basic Oxygen Furnace

15 The MIDREX® Process REDUCING GAS

HOT TRANSPORT CONVEYORIn cases where the meltshop is not immedi-ately adjacent to the MIDREX® Shaft Furnace, an option is to use an insulated mechanical conveyor to transport HDRI to the meltshop at a temperatures of 550° C or higher.

In this case, DRI is discharged hot from the furnace onto a fully enclosed and insulated conveyor, which is designed to minimize temperature loss and prevent re-oxidation. The conveyors are specially designed for Midrex by Aumund Fördertechnik GmbH.

The HDRI is fed to storage bins located above the EAF. As one bin is being filled, the other one is discharging HDRI to the EAF. It is critical that the transport method from the shaft furnace to the EAF be capable of delivering HDRI without adversely affect-ing product quality, while providing maximum operational flexibility. Module E at Hadeed in Saudi Arabia is the first MIDREX Plant to incorporate this option. This patented hot transport system was pioneered by Midrex Technologies, Inc., Siemens VAI Metals Technologies and Aumund Fördertechnik.

17 The MIDREX® Process HOT TRANSPORT OF DRI TO EAF HOT TRANSPORT OF DRI TO EAF The MIDREX® Process 18

MIDREX OFFERS MULTIPLE METHODS FOR HOT TRANSPORT: HOTLINK®, HOT TRANSPORT CONVEYORS AND HOT TRANSPORT VESSELS THAT ALLOW IMPLEMENTATION AT A WIDE VARIETY OF EXISTING MILLS AS WELL AS NEW GREENFIELD SITES. ALL THREE METHODS HAVE BEEN COMMERCIALIZED.

Midrex pioneered the Shaft Furnace design for HDRI that has been part of all MIDREX® Hot Discharge plants since 1984. For any of the hot transport options, the MIDREX® Plant can be designed to produce CDRI or HBI as a secondary product stream when the meltshop cannot accept HDRI. Plants are designed to produce the two products simultaneously and to switch from one product to another quickly without disrupting product flow.

HOTLINK®HOTLINK® is based on proven technology and the design using primarily gravity transport minimizes HDRI metallization and temperature losses.

HOTLINK® delivers HDRI to the EAF at tempera-tures up to 700° C by positioning the MIDREX® Hot Discharge Furnace just outside and above the exterior wall of the meltshop. This allows hot DRI to be discharged from the shaft furnace to a surge bin and then directly to the EAF.

The primary goal is to supply hot DRI to the EAF as demand requires. HOTLINK® Plants have been built in Egypt and Oman.

HOT TRANSPORT VESSELSAnother means for transporting HDRI to the meltshop is with the use of vessels, normally with a capacity of 45-90 tons. The vessels are first filled with inert gas or nitrogen, and con-nected to a sealed and purged feed leg. The vessel is then filled and transported by truck or rail to the meltshop.

The use of vessels is ideal for situations in which there is an existing meltshop and it is not possible to locate the shaft furnace close enough to utilize HOTLINK® or a hot transport conveyor.

MIDREX® Plants pioneered the use of hot transport vessels in the 1990s and other plants including LION HBI use similar vessels. More than 40 million tons of HDRI have been charged to the EAFs by this method.

HOT TRANSPORT OF DRI TO EAF

MIDREX HOT CHARGING METHODS

HOTLINK®(Distances < 40m)

Reference: Jindal Shadeed (Oman) Reference: Hadeed Mod E (Saudi Arabia) Reference: Lion HBI (Malaysia)

HOT TRANSPORT CONVEYOR(Distances < 200m)

HOT TRANSPORT VESSELS(Distances > 100m)

EAF

BriquetteMachine

Optional

HBI Storage

DRI Storage

DRI Cooler

HDRIDistance to EAF less than 40 m

MIDREX®

Shaft Furnace

Hot TransportConveyor

Hot TransportConveyor

Optional

BriquetteMachine

HBI Storage

DRI Storage

DRI Cooler

HDRIDistance to EAF less than 200 m

MIDREX®

Shaft Furnace

EAF

Electric Arc Furnace

Optional

Hot TransportVessel

BriquetteMachine

HBI Storage

DRI Storage

DRI Cooler

HDRIDistance to EAF greater than 100 m

MIDREX®

Shaft Furnace

EAF

Electric Arc Furnace

HOTLINK®

HOT TRANSPORT CONVEYOR

HOT TRANSPORT VESSELS

Electric Arc Furnace

19 The MIDREX® Process PLANT PERFORMANCE VALUE OF MIDREX The MIDREX® Process 20

MIDREX® DIRECT REDUCTION PLANTS, THROUGH YEARS OF EXPERIENCE AND CONTINUOUS INNOVATION, ARE THE STANDARD BY WHICH THE DIRECT REDUCTION INDUSTRY IS MEASURED.

MIDREX® Plant Performance is defined by how well the flexibility and proven reliability of the MIDREX Plant operation allows a client to take advantage of boom markets as well as weather the storm of bad times.

In good market conditions MIDREX Plants overwhelmingly produce more DRI than any other technology. When the market is down, MIDREX Plants can be efficiently operated at lower capacities to provide the best economics for overall operation. DR plant owners that have both MIDREX and competing technologies routinely idle the DR plant utilizing the competing technology and run only their MIDREX Plant during the tough economic period.

Further, MIDREX Plants stay in production for many years. Even plants built in the early-1970 continue in operation, exceeding their original planned product quality and productivity. MIDREX Plants are so reliable that if local economic conditions cause profitability to decline, they are typically moved to another location.

PLANT PERFORMANCE

MIDREX® Plants are designed to help owners and operators best deal with real world market changes. There are several factors that can affect the profitable operation of a direct reduction plant such as ore costs, energy costs, labor and the unpredictability of the steel market. Out of all the variable factors, the choice of process technology is the only one that the owner can truly control and more importantly, it is the one that can affect profitability in both good and bad economic times.

MIDREX® Plants demonstrate by far the greatest availability (hours of continuous operations) of any direct reduction technology. Every MIDREX Plant ever commissioned has exceeded its annual rated capacity on a real annual basis. Numerous MIDREX Plants have produced up to 500,000 or more tons of DRI in a calendar year than their original design capacity. In terms of both total tons produced and percentage of rated capacity, MIDREX® is the industry leader.

VALUE OF MIDREX

VALUE IS INSTRUMENTAL TO SUCCESS.

THE VALUE OF A DRI TECHNOLOGY SUPPLIER CAN BE MEASURED BY THE ENTIRE TECHNOLOGY PACKAGE, PROJECT EXECUTION AND OVERALL PLANT PERFORMANCE.

MIDREX® Plants are the most price effective DRI Plants to build, own and operate. They have this reputation due to the years of technology innovation, operation and longevity of each plant built.

Every single MIDREX Plant ever commissioned has exceed-ed its design capacity and has done so consistently on an annual basis. At least 20 MIDREX Plants have operated an impressive 8,300 continuous hours (or even higher) within a given year. That means these plants were in operation for more 95% of the year. The simple fact is if a DR Plant is not running it cannot make product. If it can only run at a fraction of its total design capability then it is a waste of a large capital investment, so we design and construct our plants to produce consistently with as little disruption as possible.

At Midrex we define value as the total worth of what we can bring to our clients and customers. This goes far beyond

providing the most innovative and top producing technology solutions. It also includes providing the best methods of building plants, from design and ore testing to transferring technology through onsite training and on-going MIDREX® Licensee support. Midrex can also assist with ECA financing if needed for the project. In addition, progressive installation and construction methods and plans mean most MIDREX Plants can be erected and ready to run in 24 months.

We have experienced erection, operations and maintenance personnel from around the world. Our engineering staff has pioneered some of the Direct Reduction industry’s most impressive innovations. Midrex’s technical services team provides ongoing support through periodic technical services bulletins and annual MIDREX® Operations conferences. In addition, our dedicated Midrex Global Solutions aftermarket group helps keep operations running smoothly by sourcing spare parts and engineered solutions because value to us means passing value on to our clients.

MIDREX’S FOCUS IS TO BRING OUR CLIENTS NOT ONLY THE BEST TECHNOLOGY SOLUTION, BUT TO BRING THEM THE BEST FINANCIAL PAYBACK FOR THEIR INVESTMENT.

Hours of Operation x Capacity = Production = ProfitsProfits x Years = VALUE

Hours of Operation x Capacity = Production = Profits

Mill

ion

tons

per

yea

r

0.035 or more

Prior to 197730 to 35

1977 to 198225 to 30

1982 to 198720 to 25

1987 to 199215 to 20

1992 to 199710 to 15

1997 to 200210 or less

2002 to present

0.5

1.0

1.5

2.0

Age of Plants (years) & Date of Start Up

Technology Development

INNOVATION THAT WORKS

Average Rated CapacityBest Annual Production of Period

21 The MIDREX® Process MIDREX® PLANTS MIDREX® PLANTS The MIDREX® Process 22

PRODUCTION OF DIRECT REDUCED IRON BY SHAFT FURNACE PROCESSES

Total of all other shaft furnaceprocesses

MIDREX® Process

(1970 through 2011)

2011 Total Production55.5 Mt

Plant Location Capacity (Mt/y) Modules Product Start-up Status**

MIDREX® PROCESSOregon Steel Mills 1 Pilot Plant1 Portland, Oregon, USA 0.08 1 CDRI ‘69 DOregon Steel Mills 2 Pilot Plant1 Portland, Oregon, USA 0.08 1 CDRI ‘69 DArcelorMittal Georgetown2 South Carolina, USA 0.40 1 CDRI ‘71 DArcelorMittal Hamburg Hamburg, Germany 0.40 1 CDRI ‘71 OArcelorMittal Canada 1 Contrecoeur, Quebec, Canada 0.40 1 CDRI ‘73 OTenarisSiderca Campana, Argentina 0.40 1 CDRI ‘76 OArcelorMittal Canada 2 Contrecoeur, Quebec, Canada 0.60 1 CDRI ‘77 OSIDOR I Matanzas, Venezuela 0.35 1 CDRI ‘77 OAcindar3 Villa Constitucion, Argentina 0.60 1 CDRI ‘78 OQatar Steel I Mesaieed, Qatar 0.40 1 CDRI ‘78 OSIDOR II Matanzas, Venezuela 1.29 3 CDRI ‘79 OArcelorMittal Point Lisas I & II Point Lisas, Trinidad & Tobago 0.84 2 CDRI ‘80/’82 ODelta Steel Warri, Nigeria 1.02 2 CDRI ‘82 IHadeed A & B Al-Jubail, Saudi Arabia 0.80 2 CDRI ‘82/’83 OOEMK I - IV Stary Oskol, Russia 1.67 4 CDRI ‘83/’85/’85/’87 OAntara Steel Mills Labuan Island, Malaysia 0.65 1 HBI ‘84 OKhouzestan Steel Co. I - IV Ahwaz, Iran 1.84 4 CDRI ‘89/’90/’92/’01 OEZDK I El Dikheila, Egypt 0.72 1 CDRI ‘86 OLISCO 1 & 2 Misurata, Libya 1.10 2 CDRI ‘89/’90 OEssar Steel I & II Hazira, India 0.88 2 HBI/HDRI ‘90 OFMO Puerto Ordaz, Venezuela 1.00 1 HBI ‘90 OVENPRECAR Matanzas, Venezuela 0.82 1 HBI ‘90 OEssar Steel III Hazira, India 0.44 1 HBI/HDRI ‘92 OHadeed C Al-Jubail, Saudi Arabia 0.65 1 CDRI ‘92 OMobarakeh Steel A - E Mobarakeh, Iran 3.20 5 CDRI ‘92/’93/’94 OJSW Ispat, Ltd. Raigad, India 1.00 1 CDRI ‘94 OEZDK II El Dikheila, Egypt 0.80 1 CDRI ‘97 OLISCO 3 Misurata, Libya 0.65 1 HBI ‘97 OArcelorMittal Lázaro Cárdenas Lázaro Cárdenas, Mexico 1.20 1 CDRI ‘97 OCOMSIGUA Matanzas, Venezuela 1.00 1 HBI ‘98 O ArcelorMittal Point Lisas III Point Lisas, Trinidad & Tobago 1.36 1 CDRI ‘99 OArcelorMittal South Africa4 Saldanha Bay, South Africa 0.80 1 CDRI ‘99 OEZDK III El Dikheila, Egypt 0.80 1 CDRI ’00 OEssar Steel IV Hazira, India 1.00 1 HBI/HDRI ‘04 ONu-Iron5 Point Lisas, Trinidad & Tobago 1.60 1 CDRI ‘06 OEssar Steel V Hazira, India 1.50 1 HBI/HDRI ‘06 OMobarakeh Steel F Mobarakeh, Iran 0.80 1 CDRI ‘06 ODRIC I & II6 Dammam, Saudi Arabia 1.00 2 CDRI ‘07 OHadeed E7 Al-Jubail, Saudi Arabia 1.76 1 HDRI/CDRI ‘07 OLGOK II8 Gubkin, Russia 1.40 1 HBI ‘07 OQatar Steel II Mesaieed, Qatar 1.50 1 CDRI/HBI ‘07 O

** Status Codes: O – Operating I – Idle C – Under Contract or Construction D – Decommissioned

MIDREX® PLANTS

Shaft Furnace Design

SINCE 1969, THERE HAVE BEEN MORE THAN 70 MIDREX® SHAFT FURNACE DIRECT REDUCTION MODULES BUILT IN 21 COUNTRIES WORLDWIDE.

Overcoming technical, commercial and geographical challenges, MIDREX® Plants are able to perform reliably at or above rated capacity in climates that range from the dry, sandy heat of Saudi Arabia to the frigid cold of Canada and Russia. To-date only three MIDREX® Modules have ever been decommissioned, the two small demonstration plants built in Portland, Oregon in 1967-69 and the first full sized commercial scale plant built in Georgetown, South Carolina, USA in 1969-71. Much of the equipment from the Georgetown facility remains in operation at sister plants operated by the same owner.

Plant Location Capacity (Mt/y) Modules Product Start-up Status**

MIDREX® PROCESS (Continued)Khouzestan Steel V Ahwaz, Iran 0.80 1 CDRI ‘08 OLion DRI Banting, Malaysia 1.54 1 HDRI/HBI ‘08 OHOSCO I & II Bandar Abbas, Iran 1.65 2 CDRI ‘09/‘10 OEssar Steel VI Hazira, India 1.50 1 CDRI ‘10 OKhorasan Steel I Khorasan (Mashad), Iran 0.80 1 CDRI ‘10 OIMPADCO Khorasan (Mashad), Iran 0.80 1 CDRI ‘11 O Jindal Shadeed Sohar, Oman 1.50 1 HDRI/HBI ‘11 O IGISCO Ardakan (Yazd), Iran 0.80 1 CDRI ‘12 * CArfa Steel Ardakan (Yazd), Iran 0.80 1 CDRI ‘12 * C Khorasan Steel II Khorasan (Mashad), Iran 0.80 1 CDRI ‘12 * CJindal Steel & Power9 Angul, India 1.80 1 HDRI/CDRI ‘12 * C Tuwairqi Steel Mills Karachi, Pakistan 1.28 1 HDRI/CDRI ‘12 * CESISCO Sadat City, Egypt 1.76 1 HDRI/CDRI ‘13 * CSaba Bandar Abbas, Iran 1.50 1 CDRI ‘13 * C SULB Hidd, Bahrain 1.50 1 HDRI/CDRI ‘13 * CJSW Projects Ltd. Toranagallu, Karnataka, India 1.20 1 HDRI/CDRI ’13 * CLGOK 3 Gubkin, Russia 1.80 1 HBI TBA C

Shaft Furnace Design

FOOTNOTES

1. Original demonstration plants built for Oregon Steel Mills used to develop the MIDREX® Process. Ceased operating after the cost of natural gas to the plants rose to more than ten times the original cost.

2. Facility idled after its natural gas supply rose to eight times original cost. Parent company sold facility as it was about to restart; new owners relocated main process equipment to support their more strategically located MIDREX® Plants.

3. Record holder for most cumulative production from a single Direct Reduction module, producing more than 25 million tons to date.

4. 1st commercial COREX®/MIDREX® Plant

5. Original module first built in 1990s in the USA as the 1.2 mtpy AIR plant idled due to low industry demand and record high natural gas prices in North America; moved to Trinidad & Tobago in 2005, and the plant was expanded by Midrex Technologies Inc. to new a new design capacity of 1.6 mtpy.

6. Original modules first built in the 1970s in the UK and moved to USA in the late 1990s, then dismantle and moved again to Saudi Arabia in 2005-2006.

7. Largest Producing DRI module currently in operation - nearly 2 Mt in 2011.

8. Largest HBI Shaft Furnace Module in Production

9. 1st commercial MXCOL® Plant using coal gasifier * Client’s projected date of start up as of 3Q 2012

www.midrex.com

November 2012

INDIA:Midrex Technologies India Private, Ltd.Global Foyer, Golf Course Road Gurgaon-122002, Haryana | IndiaTel: 0124-4908712Email: sales@midrex.in

USA / CORPORATE HEADQUARTERS:Midrex Technologies, Inc. 2725 Water Ridge ParkwaySuite 100 Charlotte, NC 28217 USATel: +1 (704) 373 1600Email: sales@midrex.com

UK:Midrex UK Ltd.Two London BridgeLondon, SE1 9RAUnited KingdomTel: +44(0)207 0891520Email: info@midrex.com

CHINA:Midrex Metallurgy Technology Services (Shanghai) Ltd.1505 Park Place1601 Nan Jing West RoadShanghai 200040 PRCTel: +86 21 61573700Email: sales@midrex.cn