The billions of microscopic bacteria at Tata Steel's blast furnaces are converting its emissions into products ranging from food packaging to animal feed.
A pilot project has been set up at the two huge Port Talbot iron making furnaces. While still in its infancy the project has already shown promising results.
Dr Rhiannon Chalmers-Brown from the University of South Wales, said: "As the world is coming to terms with the challenges of net-zero CO2 steelmaking, there are lots of options to consider. Not only in terms of different steelmaking technologies, but also around any opportunities to capture and use the carbon-based process gases.
"The process we are testing here bubbles off-gases from the blast furnaces through sewage sludge, which contains a certain type of bacteria which is able to consume both carbon monoxide and carbon dioxide."
And she added: "We're currently getting quite high levels of carbon utilisation which we think we can increase up to about 98%.
"The waste products from those bacteria include acetic acid and volatile fatty acids which can be used for a huge range of commercially viable end-uses such as paints, bioplastic-polymers or even animal feeds."
The project is just the latest collaboration between Tata Steel and the university exploring how waste gasses from the steelmaking processes at Port Talbot can be harnessed and used to support other industries while reducing the amount of CO2 released.
Dr Chalmers-Brown added: "While this pilot is looking at gases from blast furnaces, pretty much every iron and steelmaking technology emits some carbon-based gases, so this technology has potential to reduce those emissions whichever technology route is eventually chosen.
"There's still quite a lot of work to do with the pilot reactor, collecting data and to understand what we can about the biological reactions."
Gareth Lloyd, Process Engineering Manager from Tata Steel and industry sponsor, added: "This is a great project, which could be a real game-changer and is yet another example of the benefits of working closely with some of our top universities."
Tata Steel in the UK has the ambition to produce net-zero steel by 2050 at the latest and to have reduced 30% of CO2 emissions by 2030. The vast majority of that work will happen in South Wales where the company's largest operational site is. Tata Steel is developing detailed plans for this transition to future steelmaking based on low CO2 technologies.