Thyssenkrupp Steel is to continue with its plans to convert to direct reduced iron, the company said on Monday, following media reports over the weekend that it was considering axing the project.

“Thyssenkrupp has not changed its attitude towards the green transition and climate-neutral steel production,” the company notes in a statement to Kallanish.

It underlines “there is no way around the decarbonisation of CO2-intensive steel production” and that the construction of a DRI facility will take place under the current conditions.

Thyssenkrupp Steel has recently been shaken by the departure of several executives, as well as the ongoing economic lull across Europe resulting in low steel demand.

Over the weekend, dpa and Handelsblatt reported the company is questioning the costly construction of a DRI-based plant to replace the existing blast furnace route, citing inside sources.

While thyssenkrupp’s reply dismisses the allegations, it does concede that costs could be higher than the €3 billion ($3.3 billion) initially projected.

Last month, the government of North Rhine Westphalia granted an additional €400 million after a meeting with the company.

Separately, thyssenkrupp’s appeal was rejected last week against the European Commission’s decision to prohibit its merger with Tata Steel.

The proposed merger was filed in 2018 and rejected by the European Commission in September 2019. The firm moved to annul the Commission's decision at the European General Court, which however confirmed the rejection in June 2022. Thyssenkrupp subsequently brought an appeal before the Court of Justice against that judgment.

In its argument, thyssenkrupp among other points claimed that the general court had distorted certain evidence. However, last week, the Court of Justice dismissed the appeal in its entirety, upholding the judgment of the general court and the Commission's decision.