Company Announcements

22 May 2024

Ferrexpo plc

("Ferrexpo", the "Company" or the "Group")

Life Cycle Assessment confirms lower emissions benefits using Ferrexpo DR pellets

Ferrexpo plc (LSE: FXPO), a premium iron ore pellet producer and supplier to the global steel industry, announces the findings of its Life Cycle Assessment ("LCA"), completed in collaboration with environmental consultants Ricardo Plc to evaluate the Company's contribution to potential environmental benefits related to steel production using its direct reduction (DR) pellets. The DR pellet is a type of iron ore used in steelmaking whereby either natural gas, electricity (including from clean sources) or hydrogen is used as the means of converting iron ore to steel, rather than coal, which is used by blast furnace operators. DR pellets can also be used in the Blast Furnace-Basic Oxygen Furnace ("BF-BOF") route to reduce CO₂ emissions further.

Findings of the LCA show that the Direct Reduced Iron - Electric Arc Furnace ("DRI-EAF") steelmaking process, using Ferrexpo's high-grade premium Direct Reduction (DR) pellets, offers decarbonisation opportunities for steel manufacturers with reductions of 37% embodied carbon emissions, compared to the more traditional sinter-operated BF, in the BF-BOF route of steelmaking. The associated embodied carbon value of Ferrexpo DR pellets was calculated to be 172kg CO₂ equivalent per tonne of DR pellets.

Ferrexpo is using this initial LCA to explore how to further reduce its impacts across a range of environmental issues including water and waste. The Group is also engaging with its customers on these initiatives, including the possibility for further LCAs to better understand the impact of its other premium high grade iron ore products.

Commenting on the emissions benefits of using Ferrexpo's premium high grade DR pellets, Yaroslavna Blonska, Acting Group Chief Marketing Officer commented:

"As a supplier to the global steel industry, we are aware that our customers, and end users, want to reduce carbon emissions in steel making. It is pleasing therefore that the Life Cycle Assessment we completed with Ricardo plc, which was also independently verified, has determined that when a steel manufacturer uses Ferrexpo's DR pellets in an electric arc furnace, to produce a tonne of steel billet, 37% less carbon is emitted compared to traditional steel production methods. This means that Ferrexpo and Ukraine can play a leading role in enabling the transition to greener steel, not only today, during a time of war, but also in the future, when we can return to full capacity, and contribute meaningfully to the reconstruction of Ukraine."

Background to the LCA

The study compared two distinct production methods for SAE 1006 grade steel: a DR pellet-Direct Reduction Iron ("DRI")-Electric Arc Furnace ("EAF") route and a sinter-Blast Furnace ("BF")-Basic Oxygen Furnace ("BOF") method, the latter being the more traditional steel making route which relies more heavily on coal and coke usage, rather than natural gas and electricity which can be from clean sources. The study assessed the embodied carbon impacts of each route using the Global Warming Potential ("GWP") indicator which reports in terms of carbon dioxide equivalents (CO₂ equivalent), as well as a range of other potential environmental impacts.

In terms of the underlying data used for the study, we used historical activity data from 2021 (the most recent data which was available at the time of the study) for our mining, beneficiation and pelletisation operations, as well as collaborating with several iron and steel manufacturers to obtain data for those stages outside of our control. Where data was not available, reputable LCA databases were used to gap fill to ensure that all necessary impact sources were captured. The study was carried out using SimaPro software, using the widely used ecoinvent database for secondary data, and complies with ISO 14040 and ISO 14044, the key underlying standards for LCA. Furthermore, it was independently critically reviewed and found to be in accordance with these standards.

For further information, please contact:

Ferrexpo:                              

Nick Bias                  n.bias@ferrexpo.ch                 +44 (0)20 7389 8305

+44 (0)7733 177 831

Tavistock:                             

Jos Simson              ferrexpo@tavistock.co.uk        +44 (0)20 7920 3150

Gareth Tredway                                                      +44 (0)7785 974 264

Notes to Editors:

Ferrexpo is a Swiss headquartered iron ore company with assets in Ukraine and a premium listing on the London Stock Exchange in the FTSE 250 index (ticker FXPO). The Group produces high-grade iron ore pellets, which are a premium product for the global steel industry and enable reduced carbon emissions and increased productivity for steelmakers when the Group's iron ore pellets are converted into steel, compared to more commonly traded forms of iron ore. Ferrexpo's operations have been supplying the global steel industry for over 50 years. Before Russia's invasion of Ukraine in February 2022, the Group was the world's third largest exporter of pellets to the global steel industry. The Group has a customer base comprising of premium steel mills around the world. For further information, please visit www.ferrexpo.com.