ArcelorMittal Retracts Carbon-Capture From First EU Fund Phase

ArcelorMittal withdrew its French carbon capture project from the first phase of a 1.5 billion-euro ($1.9 billion) European Commission funding program, raising the prospect the initial round won’t finance any such projects.

The world’s largest steelmaker pulled out because of “technical difficulties” and is not abandoning a plan to gather emissions from the Florange steel mill in northeast France, the company said today in a statement.

The Commission’s NER300 initiative was designed to get carbon-capture and storage, or CCS, off the ground as Europe seeks to lower pollution. With the French project’s withdrawal, the program’s first phase is unlikely to fund a single CCS venture, according to Chris Davies, a member of the European Union Parliament’s Environment Committee. Davies introduced the NER300 concept to the European Parliament.

“Almost all of the EU funds available to support CCS and innovative renewable projects across Europe are likely to be allocated to the letter,” he said in a Nov. 11 statement.

The Commission declined to comment on that prospect when contacted. Isaac Valero-Ladron, climate spokesman for the Commission, said ArcelorMittal notified it of the withdrawal. The project could still compete in the second round of NER300 funding starting next year, he said.

French President Francois Hollande gave ArcelorMittal until Dec. 1 to either keep 600 threatened jobs at the Florange plant, sell all of it or face its nationalization. ArcelorMittal had wanted to shut two blast furnaces at the site. An accord was reached Nov. 30 that included agreement to mothball the blast furnaces for the carbon capture program. The company said today its withdrawal was consistent with that agreement.

Europe is encouraging carbon-capture technology because it siphons off polluting emissions from factories and power generation for permanent burial underground. The Commission planned to award two to three projects as much as 337 million euros each in the first round before the end of the year. Britain’s two proposals, Teesside and White Rose, were not successful in the first phase, Energy Secretary Ed Davey said Nov. 29.

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