H2 Green Steel says leading European banks support Eur3.5 billion debt financing

H2 Green Steel has received support from major European financial institutions for Eur3.5 billion ($3.46 billion) in debt financing to sustain its hydrogen-powered “green steel” plant in northern Sweden, the company said Oct. 24.

H2 Green Steel is building a green hydrogen-powered steel plant in Boden, northern Sweden, with initial production of 2.5 million mt/year from 2025, potentially increasing to 5 million mt/year by 2030, while removing up to 95% of carbon emissions compared with traditional steelmaking with a blast furnace and iron ore, it said.

The company plans to finance the construction of its hydrogen-powered green steel plant in northern Sweden through a combination of equity and debt financing.

H2 Green Steel has executed a conditional commitment letter with a leading infrastructure fund comprising large Nordic investors in connection with their lead participation in a circa Eur500 million junior debt facility.

Societe Generale is acting as lead financial advisor on the senior and junior debt facilities. KfW IPEX-Bank is acting as joint financial advisor on the senior debt facility. BNP Paribas, ING and UniCredit are acting as Pathfinders for the financing as respectively market, documentation and technical banks.

“These strong commitments to our debt financing show how far we have come on our journey, in a very short time,” said Henrik Henriksson, H2 Green Steel’s CEO, in a statement. “We are impressed by the collaborative approach of these institutions and the leadership they are displaying in financing the transition. The support from the European Investment Bank, Swedish National Debt Office and some of the world’s leading export credit agencies and banks, not only underlines our business case and debt carrying capacity, but also highlights the willingness to support initiatives that will help fulfil the target of the Paris agreement.”

Platt assessed the 62% Fe Iron Ore Index at $93/dry mt CFR North China Oct. 21, up $1.60/dmt from Oct. 20. Platts is part of S&P Global Commodity Insights.

— Annalisa Villa