British Steel, the integrated long steel and slab producer in Scunthorpe, is proposing to close its coke ovens and is examining other cost-saving measures.
It is looking to reduce the cost of the carbon emissions allowances it has to buy, and the ovens are approaching the end of their operational life. The firm's carbon bill increased by £70mn last year.
British Steel said the closure of the ovens is part of its "drive" to build a sustainable future. It will still need to import coke, which will still be produced in coke ovens from coking coal.
Chief executive Xifeng Han said "steelmaking in the UK remains uncompetitive when compared to other international steelmakers. Our energy costs, carbon costs and labour costs are some of the highest across the world".
Coke oven offgases can be captured and reused in the rolling process. Liberty Merchant Bar, at the Scunthorpe site of British Steel, uses such gases. It will need to find alternative sources of gas, and probably require investment to enable the transition.
There had been interest in acquiring the facility, but this has waned with the threat of the coke oven closure.
The UK's other blast furnace-based producer, Tata Steel, also has two operational blast furnaces, and coke ovens that are approaching the end of their useful life. One of its blast furnaces will probably need replacing by 2027.
The reduction in UK coking coal demand could have ramifications for the planned Whitehaven mine in Cumbria, although British Steel had already said the sulphur content of Whitehaven coal is too high for its blend.
UK Steel, which represents UK producers, has for years lobbied governments to tackle high energy costs.
