A fire at one of the four coking coal batteries at British Steel's Scunthorpe production hub in northeast England has curtailed gas supply availability to rolling lines, including Liberty Steel's nearby merchant bar mill.
The fire broke out Wednesday afternoon at the Appleby Cove Ovens, following reports of an explosion. While coking coal production is likely to be affected -- and as a result, liquid steel production -- the current focus is on the gas supply network.
The offtake gas is required for the facility's reheat furnaces, which heat up the semi-finished steel before it can be rolled into wire rod, sections, rail and profiles.
"Despite yesterday's incident, we still made our steelmaking target for the day and our sinter plant, blast furnaces, steelmaking operations and mills operated as near to normal," a British Steel spokesperson told S&P Global Platts. "Today, there's a reduced gas supply, but we're hoping to significantly step this up in the coming hours, ensuring there's minimal impact on our business and our customers."
One trader source said a fix for the facility could be challenging. "The gas feed will lead into all four of those ovens," the source said. "The process will be to isolate that [fire-struck] battery, reconfigure the other three and reintegrate them. It's a lot of electrical work to be done."
British Steel targets annual steel output of around 2.5 million mt/year from a two blast furnace operation at Scunthorpe.
Sources said Liberty Merchant Bar has been without gas since the incident. "Liberty's order book was pretty much full anyway because of the problems they had in November [with a separate gas outage], so they're full with orders -- some new and some catching up," a stockholder said. "So it's all about how long they will be without the gas supply. If it's just a couple of days, it's not a major trauma as they're already behind. New orders are for March/April rolling anyway."
Stated capacity at the merchant bar mill is 300,000 mt/year, but the site has been working at an effective capacity of around 200,000 mt/year, the stockholder said.
Liberty did not immediately respond to requests for comment.
