ARCELORMITTAL ITALIA ITALIAN STEEL: BUILDING A SUSTAINABLE TOMORROW - ARCELORMITTAL EUROPE MEDIA DAY 2018
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ArcelorMittal Italia Italian steel: building a sustainable tomorrow ArcelorMittal Europe Media Day 2018
ArcelorMittal Italia • Key deal milestones • The priorities of our plan • Our plan, our first results, our new targets
ArcelorMittal Italia • Key deal milestones • The priorities of our plan • Our plan, our first results, our new targets
Why ILVA is strategical for ArcelorMittal
Concentration of production in
1 larger and more efficient sites
Increased geographical balance and better presence in
2 South Europe and in Italy, the second largest European
steel consuming market
Solid asset base
3 Taranto is the largest integrated steel plant in Europe
Key deal milestones 2014 - 2017
2014 Beginning 2015 Jan 2016 June 2017 Sept 2017
First First Second ILVA is Environmental
publication of ArcelorMittal publication of assigned to law approved
ILVA contract offer ILVA contract AM InvestCo,
notice notice
contract
signed with
Italian
government
Key deal milestones 2018
May 2018 July 2018 6 Sept 2018 1 Nov 2018
Antitrust approval Enhanced Agreement ArcelorMittal
from European environmental with unions Italia takes over
Commission and social ILVA operations
commitments
Environment A solution for everyone
• Most ambitious environmental plan ever 10,700 people hired by ArcelorMittal.
• Enhanced deadlines and performance commitments For the employee remaining in ILVA AS:
• Access to voluntary separation programme
• No forced lay-off
• Hiring guarantee by ArcelorMittal at the end of the plan
ArcelorMittal Italia • Key deal milestones • The priorities of our plan • Our plan, our first results, our new targets
The three priorities
Sustainability and reputation
• Health & safety and environment
• Compliance
Performance and profitability
Integration
The approach
Sustainability Performance Integration
and reputation and profitability
Beg. Nov End 2018 2019 Beyond
Target setting and Prioritisation and Turnaround Structural
planning. implementation implementation continuous
Quick win launch launch (short cycles) • Projects improvement
• Priorities set and realisation (inc. towards excellence
agreed environment)
• Tracking and • Stop losses
steering
ArcelorMittal Italia • Sustainability & reputation: our plan, our first results, our next targets
Sustainability and reputation: health and safety
The plan
Align the health and safety performances to ArcelorMittal standards
ArcelorMittal promotes improvements
to reach “world-class” levels through
• Training > e.g. "Take Care” training ArcelorMittal Health & Safety Lost Time Injury
for all workers (47,000 people): 20 Frequency (LTIF) rate*
day-programme to improve health and Extraction & steel, workers and contractors
safety culture on top of all legal 3.1
requirements 2.5
• Monitoring > Our attention is directed 1.9 1.8
1.4
towards all of the touch points found in 1.0 0.9 0.9 0.8 0.8 0.8 0.6 0.7 0.6
the safety pyramid
• Certification > All of the ArcelorMittal
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 1Q18 2Q18 3Q18
Europe sites have the OHSAS 18001
certification. Our objective is to be the * Lost Time Injury Frequency is defined as the lost time for an injury for 1,000,000 hours
safest metals & mining company. worked; based on workers and internal contractors
10Sustainability and reputation: health and safety
Work in progress and next targets
H&S initial action ongoing
• Risk assessment of all sites updated against the new
organisation and the knowledge and experience gained by
ArcelorMittal
• Safety leadership training and coaching and H&S training
activities organised in November and December for more
than 7,500 people
• Introduction of new operational tools (ex. Hira Lite)
• Internal awareness campaigns on targeted topics (use of
handrails, safety glasses, etc.)Principles of compliance of ArcelorMittal
1.
Compliance
with law
5. 2.
Respect Avoid any
for the conflicts of
community • ArcelorMittal business conduct interests
• Continuous training
4. 3.
Protection and
Equity
appropriate use
of the
of company
agreements
goodsSustainability and reputation: environment
The plan
Our most ambitious environmental plan ever
Raw material yards Filter in the sinter plants
Zero dust emissions in Dust, metals and dioxin
Tamburi from the raw reduction to lower levels
materials yards and than EU BAT
conveyor belt before the €35m
first half of 2020
€300m Main areas of
intervention
Water treatment Coke plant revamping
Elimination of Technology best-in-class
run off polluted water €200m
€167m
Investments of €2.4 billion of which €1.15 billion is dedicated to the environmentSustainability and reputation: environment
The plan
€2.4 billion of investments: €1.15 billion for the environment
CAPEX commitment till 2024 (€ billions)… … which €1.15 billion are for the environment
Equivalent to
€500k per day
Reduction of diffuse
emissions
(e.g. raw material 428
Environmental yards coverage)
2018-2023 1.15
Reduction of
canalized emissions 290
(e.g. coke plants)
Industrial 172
2018 - 2024 1.25 Fixing solutions
After the investment,
Water treatment 167
ArcelorMittal Italia will
(rain and processed)
be a global benchmark
Total CAPEX
2018 - 2024
2.40 Upgrade fire
prevention plan
40 in the steel sectorSustainability and reputation: environment
The plan
Improved environmental commitments
Intervention Requirements under DPCM 2017 ArcelorMittal’s commitments Improvements
Iron ore yard coverage • Start of the works required by 30.09.2018 • Works started on 01.02.2018 • Work started 8 months earlier than required.
• Completion within 36 months from • Planning to complete in 24 months, • Expected to complete at least 22 months
ArcelorMittal taking the business within end of December 2019 ahead of deadline.
(31.10.2018)
Coal and coke yard • Completion within 36 months from Planning to complete within end of Completion at least 17 months earlier than
coverage ArcelorMittal taking the business May 2020 required.
Sinter plant dedusting • First strand to be equipped with bag • First strand to be upgraded by • 9 months ahead of the deadline
filtration technology by 31.12.2021 31.03.2021 • 11 months ahead of the deadline
• Second strand by 23.08.2023 • Second strand to be upgraded by
30.09.2022
Treatment of the coke Level of H2S content in the coke oven gas Implementation of the improvement of • Reduction of SO2 emissions associated to the
oven gas below 500 mg/Nm3, with the exception of the coke oven gas desulphurization use of coke oven gas at Taranto plant.
during the annual plant maintenance (20 days) plant within 36 months from • Maintenance of the H2S level in coke oven
ArcelorMittal taking the business. gas below 500mg / Nm3 even during the 20
days of annual maintenance.
Waste water treatment for Compliance with new limits by 1st July 2020 Built new waste water treatment, • Anticipate to future regulation by avoiding the
the Blast Furnaces applying in house technology for which use of highly hazardous chemical,
scrubbing water a patent has been filed in December formaldehyde.
2017 • Tailor made solution: onsite testing with
ArcelorMittal pilot plant ongoing since
November 2017Sustainability and reputation: environment
Work in progress and next targets
Environmental plan: quick update
Done To be completed by end 2018 What’s next?
• Implementation of the • Dredging of the channels • Primary raw materials yard
pump and treat system at (1st part – end by 31.05.19) coverage – ongoing
the raw materials yard • Coverage of the landfill G2 • Pavement of the BF slag yard –
area in order to create a (1st part – end by 31.05.19) ongoing
hydraulic barrier • Implementation of the mobile hoods for the • Investments at the coke batteries
aspiration of the fumes during BOF slag – ongoing
• Removal of the historical pouring at the “GRF area” as well as the • Conveyor belts enclosure –
storage of rail traverse and impermeabilisation of the pouring area ongoing
old tires and • Enclosure of buildings where dusty • Sinter yard coverage ordering for
characterisation of the material is handled South and North
area • Dismantling of the old tank S3 • Intervention for collection and
• Adaptation of temporary waste dumps treatment of rain water
• Start of dismantling BF3Sustainability and reputation: environment
Work in progress and next targets
Raw materials yard coverage: a unique project in Europe
1st Feb 2018 May 2018 Dec 2018 Q4 2019 May 2020
Starting of excavation Installation of Completion of the Completion of the Finalisation of the
activities on iron ore foundation poles on first arch of the shed mineral park fossils and coke
yard the iron one yard and area
assembling of the
erection piers
Yesterday Today TomorrowArcelorMittal Italia • Performance and profitability: our plan, our first results, our next targets
Performance and profitability: industrial plan
The plan
We have to bring profitability back to a
sustainable level and in line with our potential
Today's performances show a considerable gap compared
to ArcelorMittal
ArcelorMittal Italia has the potential to improve its results
quickly
Only a sustainably profitable company can invest and
create value for all stakeholdersPerformance and profitability: industrial plan
The plan
€1.25 billion for the industrial plan
To support the
important plan of
technical investments,
ArcelorMittal will have
to ensure an
appropriate cash flowPerformance and profitability: industrial plan
Work in progress and next targets
• Continuity ensured on transferred contracts & orders (inc. payments)
• Event with 130 suppliers in Taranto and individual meetings with current and
Buy potential suppliers as per business needs
• Enter into new partnership with suppliers in full transparency Next goal
• Ensure business continuity: raw materials, maintenance and repair
• November 2018: Restart production of plate mill and hot rolling mill #1
Make • Main operational priorities are being set up per area for proper industrial
turnaround
• 6mt crude steel production from 2019 onwards Next goal
• Implementation of the ArcelorMittal commercial approach and internal policies
Sell • Become a reliable supplier able to offer a superior service level through an enlarged
and improved range of products Next goalPerformance and profitability: industrial plan
Work in progress and next targets
Research & Development Centre in Taranto:
in development
• Staffing plan is done, two-waves strategy: 15 people by March
Staffing & building 2019 / at least 12 people after the summer holiday
• Final building: many solutions have been reviewed
• Performance improvement action plans started on:
R&D process environment, blast furnaces, BOF converter, secondary
metallurgy, continuous casting, hot strip mill
• Launch action plans on production processes such as pipe & tube forming,
pickling, cold rolling, galvanizing, tinning
• Completion of buying, billing, IP, IT procedures
• Start developing the network with Italian engineering schools and universitiesArcelorMittal Italia • Integration: our plan, our first results, our next targets
Integration The plan Deployment of operating practices and processes in ArcelorMittal Italia to support turnaround activities • Use of internal benchmarks in the Group to guide actions to improve industrial KPIs • ArcelorMittal experts with extensive experience in different sites, stationed on ground in Italy to support and guide Italian colleagues in their improvement actions • “Twins” from rest of ArcelorMittal Europe to provide more dedicated support for improvement and product development
Integration: communication and
corporate responsibility The plan and next targets
Our approach: transparency and continuous dialogue with all our
targets/stakeholders
Done
• Town hall meeting in Genova and in Taranto with more
than 2,200 attendees from all the departments
• Press conference and several interviews with national
and local media to present the plan
• Meeting with 130 suppliers
Next steps
• January 2019: formalise a partnership with the Soprintendenza ai beni
culturali di Taranto (local Fine Arts Service) and universities to use a location
inside the plant in Taranto to examine and stock - for research objectives -
the ruins of a Roman aqueduct near the plant which collapsed in November
• Several other CR initiatives under review and preparationIntegration: HR The plan and next targets Our people: our primary asset Done • September – November: selection of 10,700 out of 13,800 following the criteria of the agreement • 1st November onwards: secondment of 10,700 employees from ILVA S.p.A. in AS • Continuous monitoring of process and transparency toward unions • November 12th: (re)hiring process launched. About 260 recruitments per day Next steps • January: workforce complete with headcount of 10,700 • Integration of ArcelorMittal Group HR processes (evaluation, KPIs, …) • Definition of a training plan by role/function • Group mobility • Industrial relations: build new social dialogue forums, EWC
Conclusion
Sustainability and reputation
• Health & safety and environment
• Compliance
Performance and profitability
IntegrationQuestions & Answers
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