Cisdi will supply a new 150-tonne capacity electric arc furnace to the steel works, in Dunaújváros, reducing carbon emissions by about 80pc and allowing for flexibility in charge materials, significantly enhancing the competitiveness of the operation, Liberty Steel, which earlier acquired Dunaferr's assets, said.

Liberty Steel and Cisdi will have the primary responsibility for the technical aspects of the project, while the Economic Development Ministry will explore support for the project through its administrative processes, it added. 

A memorandum of understanding setting out the terms of the collaboration was signed in the capital.

Liberty Steel chairman Sanjeev Gupta said the company was transitioning to lower carbon technologies across its global operations and intended to do the same at the Dunaferr steel works.

"We know from experience that to move quickly you need the support of world-class technology partners, the right financing structures, and a supportive government, which is why the formation of this group is so important," he added.

Economic Development Minister Márton Nagy said the agreement signed on Wednesday would "lay the foundation for green steel production in Dunaújváros", providing long-term security and predictability for "thousands of jobs". He noted that those jobs had been put at risk due to the "negligence" of the company's former management, adding that the company had "come a long way" in the past year.

Cisdi chairman Xiao Xuewen said working again for Liberty Group, this time on the green transformation of the Dunaferr steel works, was "a great honor" and pledged a high-quality delivery sparing no effort.