Swedish Stirling AB and Glencore Operations South Africa Proprietary Ltd, acting on behalf of the Glencore Merafe Venture, have  signed an energy conversion service agreement for an installation of 25 PWR BLOK 400-Fs (10 MW) at the Glencore Merafe Lion ferrochrome smelter. The PWR BLOK 400-F is a product developed by Swedish Stirling which enables the conversion of industrial residual and flare gases into 100% carbon-neutral electricity.

In August 2020,  clean-tech company, Swedish Stirling entered into a letter of intent  with Glencore regarding discussions on potential energy conversion services at the Lion smelter in South Africa comprising the possible installation of up to 88 PWR BLOK 400-Fs.

The parties have now announced the signing of an energy conversion service agreement for the installation of 25 PWR BLOK 400-Fs (10MW) at the Lion smelter. The term of the agreement is 8 years from the date on which the last PWR BLOK achieves commercial operation, with an option for the Glencore Merafe Venture to extend the term by 7 years. The estimated present value for the initial term of the agreement for Swedish Stirling is ZAR700 million ($49 million).

The energy conversion service agreement is subject to certain conditions precedent including financial close. During the contract period, the installation is estimated to offset the carbon dioxide emissions from the Lion smelter by over 500,000 tonnes. The first PWR BLOK is expected to be delivered to Lion in 2022. The facility will be owned and operated through a special purpose vehicle, established and controlled by Swedish Stirling.

“The Lion smelter is one of the world’s largest ferrochrome smelters. For Swedish Stirling, this development is recognition that the PWR BLOK is a key solution for energy recovery in the metallurgical industry, and is the starting point for a large commercial roll-out,” said Gunnar Larsson, CEO of Swedish Stirling.

“We are excited to implement this project which we hope will reduce both our production costs and carbon dioxide emissions. This project is part of Glencore’s ambition to achieve net-zero total emissions by 2050,” said Japie Fullard, Head of Ferroalloys Industrial Assets at Glencore.