INTERVIEW - Mexicos Hylsa has new recycling method

MONTERREY - Mexicos third-largest steelmaker, Hylsamex , plans to implement highly efficient recycling technology for steel mills by the end of this year and license the new technology after proving it works on an industrial scale, the companys head of technology said. The new technology is the worlds first gas-based process for recovering steel mill waste oxides, Raul Quintero, general director of Hylsas HYL technology division, told Reuters in an interview on Wednesday. Hylsamex, the steel unit of one of Mexicos largest conglomerates, Grupo Alfa, has successfully tested the technology at its pilot plant in the industrial northern city of Monterrey, and plans to begin building the first industrial-scale plant before the end of the year, Quintero said. He said the company would license the technology to other steelmakers after using it successfully at the bigger plants. The technology involves processing electric arc furnace dust and mill scale for the recovery of iron units and for the separation of zinc and lead as both oxides and metals. "Because of environmental regulations, these materials are increasingly difficult to dispose of," Quintero said, adding that the companys "HY-recovery" process makes it not only easier but also financially advantageous. "Were talking about an $8 to $9 million plant, with a capacity to recuperate 20,000 to 30,000 tonnes of waste a year, which is the average for a company producing 600,000 to 800,000 tonnes of steel a year," he said. TECHNOLOGICAL LEADER Hylsas largest steelmaking operations, based on direct-reduced iron (DRI), have fewer problems with disposal of zinc and lead than more conventional steel mills using scrap metal, Quintero said. Hylsamex has been a technological leader since 1957, when it opened the worlds first successful DRI plant, with which high quality steel can be produced in electric arc furnaces, officials said. The company has licensed its DRI technology and provided training to steel plants throughout the world. It operates around 25 plants worldwide, with four more scheduled to begin construction in 2000. SELLING MEXICAN TECHNOLOGY Quintero said Hylsamex developed the technology in the late 1950s when the U.S. demand for scrap material during the Korean War made it hard for Hylsamex to find the quality scrap material it had been importing from the United States. Marketing its steel-producing technology abroad was tough in the beginning "because we were selling Mexican technology, when Mexico has never distinguished itself for selling technology," he said. "Its not easy to go and tell the Germans Well, theres this Mexican technology and this and that," Quintero said. On a separate matter, Quintero downplayed the possible effect to Hylsamex of a planned merger of rival steelmaker AHMSA and Spains Aceralia , saying there is every indication AHMSA will continue operating at its current capacity after the merger is completed. AHMSA and Aceralia are scheduled to sign the merger agreement on Friday, a day after the signing of a free-trade agreement between Mexico and the European Union. REUTERS NEWS SERVICE