A process integration approach has been applied to integrate a traditional steelmaking plant with a polygeneration system to increase energy efficiency and suppress carbon dioxide emissions from the system. Using short-cut models and empirical equations for different units and available technologies for gas separation, methane gasification, and methanol synthesis, a mixed integer nonlinear model is applied to find the optimal design of the polygeneration plant and operational conditions of the system. Due to the complexity of the blast furnace (BF) operation, a surrogate model technique is chosen based on an existing BF model. The results show that from an economic perspective, the pressure swing adsorption process with gas-phase methanol unit is preferred. The results demonstrate that integration of conventional steelmaking with a polygeneration system could decrease the specific emissions by more than 20 percent. (c) 2013 American Institute of Chemical Engineers AIChE J, 59: 3659-3670, 2013