Mining and steel giants collaborating on steel decarbonisation

The Australian Renewable Energy Agency (ARENA) has announced that it has allocated $19.8 million in funding to investigate the development of Australia’s largest ironmaking electric smelting furnace pilot plant in Kwinana, Western Australia.

The NeoSmelt project is a joint venture combining the expertise of BlueScope, BHP, Rio Tinto, Woodside and Mitsui Iron Ore Development. ARENA funding will go towards a front-end engineering design (FEED) study for the project to progress the direct reduced iron-electric smelting furnace (DRI-ESF) route for lower-emissions steelmaking.

The DRI-ESF route is a concept with the potential to overcome barriers to using Australian iron ore in future lower-emissions steelmaking. Using electric smelting furnace technology, the project aims to prove that it is possible to produce lower-carbon-emission molten iron from Pilbara iron ore.

ARENA CEO Darren Miller said that to decarbonise mining and metal production in Australia, collaboration and partnership across industry is crucial.

“Globally, the steelmaking industry makes up around 8% of global greenhouse gas emissions, so the decarbonisation opportunity is huge,” he said. “The NeoSmelt project brings together some of the world’s largest players in the mining, metals and energy industries, in a collaborative effort to reduce emissions in the sector. This represents what the energy transition is all about: working together to achieve the most efficient and effective outcome for Australia’s key export industry to transition into a lower-emissions economy.

“As the world’s largest producer of iron ore, Australia has an important role to play in reducing emissions across the steel value chain,” he added. “We’re excited by the insights this project expects to provide. This is a positive step towards building a lower-emissions steel industry here in Australia.”

Late last year, the Kwinana Industrial Area, south of Perth, was announced as the preferred location to develop the pilot plant. The FEED study, to be supported by funding from ARENA, is expected to help inform a final investment decision for the pilot plant to be built.

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