ArcelorMittal is considering closing its Steelanol facility in Ghent, Belgium, a key part of its decarbonization strategy. The plant, which converts CO2 from blast furnace gases into ethanol, faces financial unsustainability due to restrictive EU regulations.

CEO Frederik Van de Velde said a decision is expected within a year, emphasizing that even with technical success, the plant's economics remain challenging without regulatory changes. Steelanol captures residual steelmaking gases, transforming them into ethanol for chemical feedstock or fuel, potentially avoiding up to 120,000 tons of CO2 emissions yearly.

The project, an investment of EUR 215 million, rising to EUR 250 million combined with the Torero project, received significant funding from the EU, Flemish and Belgian Governments, and the European Investment Bank. ArcelorMittal itself contributed EUR 140 million.

Van de Velde criticized EU climate policy for its focus on hydrogen, arguing it neglects operational technologies like Steelanol. Steelanol offers immediate CO2 savings, but the ethanol it produces isn't recognized as an advanced or recycled fuel under current rules, which means the reduced emissions cannot be deducted from ArcelorMittal's carbon balance, diminishing the economic benefits.