Technology group The Linde Group, through its wholly-owned subsidiary BOC, has signed a long-term supply contract for industrial gases with international steel producer Corus, with the agreement involving the construction of a new air separation unit at Corus' Scunthorpe site in North Lincolnshire for around €80m.

The new ASU will have a capacity of 1,600 tpd of oxygen, as well as smaller quantities of nitrogen and will go on-stream in mid-2010 in order to support the increase in steel output from the site.

The new facilities mean BOC will be able to significantly increase its supply of gases to Corus, part of Tata Steel, which in turn will allow Corus to increase its overall steel output as part of its expansion plans.

Announcing the contract, David Edwards, director Scunthorpe Cast Products, of Corus, said, “I am very pleased that we have reached agreement with BOC on this contract. This builds on the strong relationship we have with BOC as a key supplier to our Scunthorpe site. The investment helps us to take the site forward and meet our strategic plans for the future.”

“This agreement seals the long term future of our relationship with one of our largest customers in the UK and confirms our market leadership in this key market,” reflected Dr Aldo Belloni, member of the Executive Board of Linde AG.

Mike Huggon, managing director of BOC in the UK, added, “I am delighted to be further consolidating the excellent working relationship we have enjoyed with Corus for many years. I am confident that this major contract and the investment we are making will bring long-term benefits to both our companies and demonstrates our faith in the longer-term future of the steel industry in the UK.”

The Linde/BOC investments also involve refurbishment of the existing ASU and a significant extension of the pipeline network supplying the steelworks, as part of the 15 year agreement.