Tata Steel and Tata Steel Nederland (TSN) have signed a non-binding letter of intent with the Dutch government and the province of North Holland to advance the first phase of TSN’s transition to low-CO2 steel production at IJmuiden.
The framework aims to cut emissions, improve the local environment, and secure the site’s long-term competitiveness. Negotiations will now focus on a tailor-made binding agreement, with the Dutch government indicating potential support of up to EUR 2 bln (USD 2.3 bln) and TSN applying for an additional EUR 300 mln (USD 352 mln) from the EU Innovation Fund. A final investment decision will depend on regulatory clarity, policy developments, and approval by Tata Steel’s Board.
Under the first phase, TSN plans to decommission Blast Furnace #7 and Coke & Gas Plant 2, and build a new direct reduction plant and electric arc furnace. These facilities will initially operate on natural gas, before gradually shifting to biomethane and hydrogen as they become viable at scale. Carbon capture and storage will also be added, with the overall programme expected to reduce annual emissions by up to 7.2 mln tons. Alongside decarbonisation, TSN intends to cover ore yards and slag cooling sites, install dust-reduction, noise and odour-control measures, and increase scrap use from 17pct in 2019 to 30pct to improve circularity.
Tata Steel CEO and Managing Director T.V. Narendran emphasized that significant work remains, including engineering readiness, permitting, and resolution of key policy issues such as the EU’s CBAM framework and Dutch CO2 reduction targets. He also stressed the importance of union backing and customer confidence to ensure an uninterrupted supply chain during the transition. The scale and complexity of the project mean that capital expenditure and phasing will only be finalized at the stage of signing the binding agreement, with execution expected to span several years.
1 USD / 0.85 EUR
