Stegra closes $1.4bn rescue package for green hydrogen-based steel plant

Green hydrogen-based steel firm Stegra has closed its $1.4bn rescue package and undertaken a boardroom change-up, appointing new chairs and establishing a new parent company.

It follows the of the Wallenberg Investment-led financing round, intended for completing the firm’s flagship project in Boden, Sweden, after prior funds were exhausted.

The reshuffle sees investors create Stegra Holding AB, the new controlling entity of Stegra, which owns more than 90% of shares and voting rights, with a Wallenberg-led consortium holding the largest ownership position.

The firm’s CEO, Henrik Henriksson, remains in place, while the former Stegra AB has been renamed Green Nexus Investment Holding AB and reduced to a minority shareholder.

Wallenberg’s Lief Johansson has been appointed as the board chair, replacing Shaun Kingsbury. Hydrogen financing group Hy24 will also be represented by Pierre-Etienne Franc.

“I’m very pleased to now have a very strong board in place, one that combines deep industrial competence with broad international experience, and that I’m confident will make a great team for Stegra,” said Henriksson.

The Boden steel plant was due to begin operations this year, using a 700MW electrolyser to convert iron ire into direct reduced iron (DRI), with a targeted annual capacity of five million tonnes of green steel per year by 2030.

It failed to reach completion using a $7.15bn development funding package, a second $1.07bn funding round, and $296m in EU commission grants.

Various European steelmakers have delayed or shelved plans for green hydrogen-based operations due to high costs associated with the molecule and an suggested that green steel might only comprise a 2.5% market share by 2035.