Rio de Janeiro, Brazil, August 19, 2021 - Vale has signed a memorandum of understanding with ternium, under which the two sides agreed to seek opportunities to develop steelmaking solutions focused on reducing carbon dioxide emissions.

Vale and ternium plan to conduct an economic feasibility study on the following potential investments: (1) an iron ore briquetting plant located in ternium's Brazilian plant（ 2) Several factories that use tecnored, hyl and other iron reduction technologies to produce low-carbon footprint metal charge products.

This will help vale achieve its commitment to reduce the net emissions of "scope III" by 15% by 2035. Vale also committed to reducing the absolute emissions of "scope I" and "scope II" by 33% by 2030 and achieving carbon neutrality by 2050. These commitments are in line with the Paris Agreement and will lead the development process of low-carbon mining.

Eduardo Bartolomeo, CEO of vale, and m á Ximo vedoya, CEO of ternium attended the signing ceremony of the memorandum of understanding held on August 18, 2021 local time. Mr. baiandor said in his speech: "this is an important milestone in our roadmap to provide low-carbon solutions for the steel industry. We are very happy to cooperate with ternium. We are fulfilling our commitments to society and the objectives of the Paris agreement with innovative technologies crucial to low-carbon transformation and a world-class portfolio of high-quality iron ore products. By cooperating with customers to support the decarbonization of the steel industry, we have the ability to lead the "scope III" emission reduction process. "

Mr. Maximo vedoya, CEO of ternium, said: "this is an important step for us to realize the decarbonization strategy. It will help ternium achieve its commitment to reduce carbon dioxide emissions by 20% by 2030. Vale is a key supplier in our value chain and is as committed to environmental protection as we are. I believe that we have many opportunities to cooperate and continue to promote the decarbonization process in our future operations. Carbon neutralization is a goal that can only be achieved by the concerted efforts of all sectors of society. As a leading steel sheet supplier in Latin America, we will contribute to the goal of carbon neutrality. "

On iron ore briquetting technology

Vale has developed a breakthrough iron ore briquetting technology for more than ten years. It uses a simpler and more flexible process with lower carbon emission intensity, less fixed investment and lower operation cost to briquette iron ore products such as sintering powder and pelletizing powder. The briquette product will support the continuous conversion of blast furnace to a process with low carbon emission intensity, because it does not need the traditional sintering process (the carbon emission generated by the sintering process accounts for about 10% of the carbon emission per ton of steel), and can also replace the lump ore and pellet in blast furnace and direct reduction furnace as the raw material directly connected to the furnace.

About tecnored

Tecnored, a 100% owned subsidiary of vale, focuses on the development of low-carbon ironmaking process using energy such as biomass and syngas, which emits less carbon dioxide than the traditional ironmaking process using coal and coke. The use of biomass has the potential to achieve economical carbon neutralization in the medium term.

About hyl Technology

Hyl is a low-carbon direct reduction ironmaking technology developed by ternium company in Mexico. The technology is currently applied in ternium's plants in Monterrey and Puebla, Mexico. It has the ability to selectively recover carbon dioxide, so it can significantly reduce carbon emissions compared with other reduction technologies.

About ternium

Ternium is a leading steel sheet manufacturer in Latin America, with factories in Mexico, Brazil, Argentina, Colombia, the southern United States and Central America. Through manufacturing plants, service centers and distribution networks, the company provides a wide range of high value-added steel products and advanced customer integration systems for customers in the automotive, home appliances, HVAC, construction, capital goods, containers, food and energy industries.