Aditya Mittal: Sorry, could you just repeat the last bit of your question. What do we need done, it wasn’t clear Andrew €“ Bastian,
Bastian Synagowitz: Basically, it’s where will you have to see them. Maybe have some color on the funding support. We were obviously discussing CapEx earlier, but I guess outside maybe the CBAMand what is decided here so far. What else €“ if you need it to be done to basically give you enough confidence that he can go ahead with the decarbonization and make these projects actually a call for and not just a biggest one.
Aditya Mittal: Yeah, okay, great. That’s very clear, thank you. So look, you highlighted a lot of it already, and I will just, I’ll do a little bit more detail. So the first thing is the previous questioner asked the same. We’re expecting planning and support from the European Union, the United European Union, and the various countries are actually providing that funding support. So if you have a project in Germany, it’s actually the German government, etc. etc. So that’s the first, that’s CapEx support. The second, the CBAM is important to create a level playing field. Because in Europe as you know there is a ETS system, the Emissions Trading System, which imposes costs on people who admit CO2 and steel coming into the country, should have equivalent cost.
The same in terms of exports, we need some export relief. So there is a CBAM legislation, and there’s going to do trial. And I think that’s a great development, because it’s good to see the trial. We will all learn and develop from it, and there’ll be more clarity on the CBAM, and I think it’s clear that the intent is to make it effective. Clearly, the trial and the details will go long way in determining how effective it actually is. The third things is, really the IRA in the United States. So you can see there is a active dialogue in the European Union to ensure that the EU remains globally cost competitive. Whether it is the cost of energy or the cost of hydrogen or the cost of CCS and I say that’s another very important element, because the change since we have announced all of these projects has been the build in the United States, which creates a very favorable climate in North America.
So trying to bring some of those advantages into Europe is also very important. Having said that, I would just add that one of the strengths of ArcelorMittal is the fact that it is global. We have assets in the US, we have assets in Europe, we have assets in uh in Brazil. And these are all centers which have access to and not necessary Europe, but we are assessing the locations which have access to our low cost energy or can benefit from those like the IRA. So the Texas HBI acquisition that we’ve made in Corpus Christi is a great example. Because there are a lot of CCS projects, a lot of hydrogen projects, it is really the basin of energy, and so we have a very good strategic asset there which we can grow and develop to supply low carbon metallics on a global basis.
Your question was on returns, and clearly that is the most important. As we decarbonize our business, we have to generate an adequate return. We have to make sure the business is stronger and not weaker post this investment. And as we implement these investments and getting back to the previous question, providing details on the CapEx where it’s been executed, first. What is the level of government support? We will provide a, we will provide you a clarity on what is the return profile. Just like what we’ve done with our strategic CapEx, where we talked about $4.2 billion of CapEx, $1.3 billion of EBITDA, in my opening remarks. You must have heard the highlight that this is based on long term steel spreads, long term iron ore prices, which are much lower than what we’re seeing in the market today.
