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DOCUMENTS "COM"
COM(80)305
Vol.1980/0109

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COM(80)305final
COMMISSION Brussels,OFTHE 6thJune1980
EUROPEANCOMMUNITIES FOROFFICIALUSEONLY
GeneralSecretariat
''
* * «
REQUESTFORCOUNCILASSENT,PURSUANTTOTHESECONDPARAGRAPH
OFARTICLE54OFTHETREATYESTABLISHING THEECSC,INRESPECT
OFTHEGRANTING OFALOANBYTHECOMMUNITY TOSOCIETEANONYME
CENTRALESIRDERURGIQUE OERICHEMONT(C.S.R.)-RICHEMONT (MOSELLE)
r
(Communication fromtheCommission totheCouncil)■
C0M(80)305final

COMISSION OPTHE
EUROPEAN COMMUNITIES
. Forofficiaiuseonly
.* *
Communication totheCouncil"» i–»– . -1-–I–|–|–r
Subject:RequestforCouncilassent,pursuant -tothesecondparagraph
ofArticle54ofthe.Treatyestablishing theECSC,inrespect
ofthegrantingof-aloanbytheCommunitytoSocieteAnonyme 4
CentraleSiderurgique deRichemont(c.S.R.)–Richemont(Moselle),"
TheCommissionhasreceivedanapplicationfora.loantotheamount
ofPP255millionfromSocieteAnonymeCentraleSiderurgique deRichemont(C.S
toenableittorenovatethemajorpartofitsinstallations .
C.S.R.wasformedin1950inordertoproduceelectricityinasingle
generatingplant,byburningtheblastfurnacegasfromseveralsteelplants
situatedatashortdistancefromeachotherintheOrne,FenschandMoselle
valleys.
1
Thefollowingsteel-making companiesareshareholdersinC.S.R.:
-SA.CIL0R ' . 73.54%-USIN0R ■ ' -IO.78%
–HautsFourneauxréunisdeSaulnesetUckange..9*80%
–'Société'desAciersfinsdel'Est ..5*88$

DESCRIPTION OPTiffiPROJECT TOBEFINANCED s
Theelectricity generating plant oftheRichemont iron and steel complex
comprises ;
-three 50MWgenerator sets commissioned in1954 »1955 an(i1959 ?
-twa115MWgenerator sets commissioned ini960 .
Thegenerating plant at "Richemont isfuelled ,with "blast furnace gas (an
average of4000million thermal units/yr.)from the4pig-iron works (Joeuf ,
Rombas ,LaFensch andUckange )with which itisconnected .Onalesser
scale italso burns coal andfuel oil ,which together account forabout 25
ofitstotal fuel input .This additional iijput isrequired formake–up
'purposes ,tocope with fluctuations intheflow ofgasfrom theblast furnaces
* * •
Itsoutput ofelectricity isabout 2000million kWh/yr,anddepends onthe .
volume ofblast furnac'e gasavailable .In1970 itmetpractically allthe
electricity requirements of .thewhole complex ;butsince tha'^time ,theunit
consumption ofelectricity forsteel production hasincreased andthevolume
andcalorific content value oftheavailable gashave decreased ,with the
result that thecurrent electrical output oftheplant nowhardly -covers 70$
oftheelectricity requirements oftheworks inquestion .
Forsome timenow ,the5generator setshave been showing signs offatigue :
-twoofthethree 50MWsets will probably have tobeshut down in1982 ,
andthethird towards 1985 ?
-thetwo115MWsets ought tobeshut down between noxvand1985 *
Ifthese ,installations were notreplaced ,theblast furnace gaswould notbe
economically exploited ;itwould have tobeburned atitsplace oforigin ,
thus entailing theloss oftheequivalent of350000–400000t/year offuel .
Hence the firm' sproposal' toundertake thecomplete overhaul andmodernization
ofitstwo115MWsets ,followed bytheshutdown ofthethree 5°MWsets which
will bekept in'cold !reserve .Utilization oftheexisting infrastructures
andmuch gftheexisting eqiiipment will cutthecapital outlay toabout half
thecost ofequivalent newunits .
ftalthough theoutput ofthese steelworks ,after increasing upto1974 ,has
since declined considerably andhasnowfallen back toalevel near to
that of1970 . -

-3-
Asaresult ofimproving theflexibility ofitsboilers ,thegenerating
plant will cover more than 95i°ofitsfuel requirements with blast furnace
gas ,compared with theaverage of75$achieved ,with theexisting installations .
This will improve itsthermal output ,asthemake-up fuel will bemore
efficiently used inthelarge units burning coal orfuel oil .Therefore
(apart from itssupplies ofblast furnace gas),foranequivalent output of
electricity ,thegenerating plant will consume nomorq than15-20 OOgt/yr
(compared with 35000t/yr)offuel oil ,plus 125000tog/yrofcoal .
Thesolution ofusing coal andabandoning fuel oilformake-up operations
hasbeen rejected fortechnical reasons (operating conditions )andoneconomic
;grounds (investment costs ). ,,
Infact coal istechnically less suitable asa-make-up fuel when rapid inter­
vention isrequired ,whereas fuel oilnotonly meets -this requirement but
also enjoys considerable advantages interms ofsafety andproductivity .1
Furthermore ,ifcoal hadbeen adopted asthesole make-up material ,itwould
have been necessary toreplace ,andtostrengthen ,thenecessary coal
equipment (handling ,crushing ,silos ,feed-in ,dedusting ,removal ofash)
which ,foraninput ofabout 60000t/yr,would bevery costly ,andwould add
about 30rfototheforecast capital outlay .
Commencement /completion ofwork -:1980/1985
Coot of.thpproject :PP511million (=87,2 mnsu.c.e .)
TheReduction offuel oilconsumption intheRiehemont complex (CSR)is
inline with thegeneral policy ofSacilor-Sollac ,which foritspart
managed ,inspite ofthe 3$increase init'ssteel production ,to
reduce itsfuel oilconsumption bynearly 20$between I978 and1979 ».

Conclusion î
-TheCommission isoftheopinion that theexecution ofthis project •
will make adirect andmajor contribution toreducing thecost oftheECSC
products manufactured bythesteel –making companies which' have ashare­
holding intheapplicant company .
Inview ofthe fact that inthis particular case the .useofrelatively
small quantities offuel oilasamake-up ,fuel canbejustified ontechnical
andeconomic grounds ,itadds itsapproval tothat oftheFrench authorities
inrespect oftheproject ,ofwhich ithasbeen notified inaccordance with
theCouncil Directive of14April 1975 concerning therestriction oftheuse
ofpetroleum produces inpower stations .(*).
Pursuant tothesecond paragraph ofArticle 54oftheTreaty ,the
Commission seeks theunanimous assent oftheCouncil forthegranting ofa
loan totheamount ofPP255million (43.6 million EUA)totheApplicant
company .
-(*) O.J. oftheEuropean Communities N°L178/26of9July 1975 *