Stegra needs more capital for Boden green steel plant after 100-day review

Stegra will need to raise more capital to finish the green steel plant it is building at Boden, in northern Sweden, after a 100-day review found the cost of completing the project “significantly higher than assumed.” The finding lands three months after a €1.4 billion ($1.6 billion) round led by Wallenberg Investments closed, money the new owners said at the time they believed would see the build through.

The review came with a change at the top: Håkan Buskhe, previously president and CEO of Saab, takes over as chief executive from Henrik Henriksson, who has held the role since 2021, making this the second senior appointment since the June round after Leif Johansson, the former Volvo Group CEO, became chair.

Stegra was founded in 2020 and started construction at Boden in 2022. Its process uses hydrogen made with green power to strip oxygen from iron oxide, avoiding most of the CO2 a conventional mill emits and running on 100% renewable electricity. The design target is 5 million tonnes of green steel a year at what the company calls the world’s first large-scale green steel facility.

The review left two things standing: the timeline for green steel production and the business case, both of which the company says remain strong. The cost estimate did not, pushed higher by substantial ramp-up costs following the prolonged scaling back of work earlier this year and by inflation; Stegra has begun talking to its largest shareholders about the difference.

The company was unusually direct about how the gap opened. “When we took over, we said that we believed the financing would be sufficient, but that we could not rule out that more would be needed,” it said. “We now have a complete picture of the project, investment by investment — how far we have come and what it has cost. The financing need is greater than we had hoped, but we have a robust plan to complete the project and have identified greater opportunities for outsourcing and partnerships than we previously thought.”

The June round was as much a change of ownership as a financing, with Wallenberg Investments, an arm of the Wallenberg family’s foundation, leading it alongside a consortium and the new group holding more than 90% of Stegra’s shares and votes. Behind that sits the €6.5 billion the company said it had secured for the plant by early 2024, plus an October 2025 round it announced into what ESG Today described as a significantly tougher environment for clean tech capital. Set that €6.5 billion against the 5-million-tonne design and the earlier build works out to roughly €1,300 per tonne of annual capacity, a figure that predates both the June round and this week’s revision.

Stegra said in October 2025 that it had entered a new financing round, closed the €1.4 billion in June 2026, initiated the 100-day review in its wake, and four months on, the review finds the money insufficient; the company says the technology and the schedule hold, while what has moved is the cost of finishing.

The cost driver says as much about the past year as about the plant: work at Boden was scaled back for a prolonged stretch earlier this year, and Stegra now prices the ramp back to full construction as a substantial line item in its own right. Part of today’s gap was manufactured by the earlier pause, which preserved cash through the squeeze and handed a larger invoice to whoever funds the restart; inflation did the rest.

Construction cost is the variable transition finance has been least able to hedge, and the review landed precisely there. Stegra has spent the past year assembling demand-side cover, and as this publication has argued, offtake is the new project finance; the certificate sales to Google gave it cash during the ramp, turning a buyer’s commitment into working capital well before steel moved and handing hard-to-abate industry a template for selling the attribute rather than the metal. Those contracts answer a lender’s question about who takes the output, but they do not bind the price of building the plant.

What the announcement does not carry is a number. Stegra said it has initiated a dialogue with its largest shareholders but has not said how much more capital is needed, in what form it would arrive, or on what schedule. Until one of those figures appears, Boden stands as the test of whether firm offtakes, a foundation-backed lead investor and a signed €1.4 billion round can carry a first-of-a-kind industrial build through a cost estimate that has already moved once.