Improving Operational Efficiency and Cost Competitiveness of Steel Plants - A Case Study for Electric Furnace Melt Shop and Hot Rolling Mill

Author(s) S. Babiy, V. Gunenkov, S Kumar, M. Frieslich, Y. Gordon
AISTECH 2017, Nashville, Tennessee, May 2017


A technical review of operational efficiency and cost competitiveness of OJSC Nizhnesgerginsky Hardware Metallurgical Plant (NSMMZ - NLMK-Long Products Division) in Russia was carried out. In this review, the existing operating practices, including production, process, operation and maintenance practices were evaluated for the following units:

  • EAF Meltshop– located in Revda, Sverdlovsk Region, Russia.
  • Long Products Rolling Mill - located in Beresovsky, Sverdlovsk Region, Russia
  • Central Maintenance Shop (ZITR) supporting the Melt Shop and the Rolling Mill

 The technical review of operational efficiency and cost competitiveness was carried out in two stages:

  • Stage 1 of the study consisted of the analysis of current operating practices (“the base case”), comparison with best practice plants (with pertinent normalization to account for the local conditions / differences with best practice), identification of gaps in the different areas, generation of improvement ideas for minimizing the gaps and preliminary recommendations for improvement
  • In Stage 2, the main activities included further evaluation of the improvement ideas to filter out those ideas that were associated with high implementation risks, estimation of capital and operating costs for the selected ideas and development of an implementation program (Roadmap) for the improvement actions.

The highlight of the work was the successful deployment of an effective methodology[1] developed earlier by Hatch for operational improvement / cost reduction – this methodology was implemented working closely with steel plant personnel. This methodology was earlier adopted for the assessment of GHG (greenhouse gas) and Energy Efficiency for the steel industry[2].