Rio Tinto and Bluescope explore 'low carbon steel pathways'

A Memorandum of Understanding (MOU) has been signed and the two businesses plan to research and design low-emissions processes for the steel value chain, including iron ore processing, iron and steelmaking and related technologies.

The MOU expands the partnership between the two companies, who were already jointly studying technology to reduce carbon emissions from existing iron and steelmaking processes. It will also allow more projects to be added as technologies mature.

Both companies will prioritise studying the use of green hydrogen at the Port Kembla Steelworks in Australia to directly reduce Pilbara iron ores into a product that could then be processed in an electric melter to produce metallic iron suitable to be finished into steel.

Simon Trott, Rio Tinto's iron ore chief executive commented “We are excited to sign this MOU with leading steelmaker BlueScope, a key customer of ours in Australia, and extend our partnership to low carbon iron and steelmaking.

“This partnership will benefit from BlueScope’s experience and know-how in using electric melters at its New Zealand steelworks, Rio Tinto’s experience in the Atlantic direct reduction market and the R&D capability and the experience of both Rio Tinto and BlueScope in iron ore processing.

“It is early days, but given both BlueScope and Rio Tinto are committed to net zero carbon emissions by 2050, we realise we need to investigate multiple pathways and strike partnerships across the steel value chain.”

Mark Vassella, CEO of Bluescope, said “We are pleased to be working with Rio Tinto, who supply the majority of iron ore to our Port Kembla plant. It’s a natural fit for us both and a meaningful opportunity for Australian steelmaking and mining to explore ways of contributing to emissions reduction targets.

“The new collaboration will focus on utilising green hydrogen for direct reduction of Rio Tinto’s Pilbara iron ores, which will then be fed into a melter.”

“This is an important programme – one which will need broad support from governments, regulators, customers and suppliers. At a time when there is much talk and expectation about climate, this is an example of two significant Australian businesses getting on with real action. We are putting our dollars and our people right on the front line of addressing climate change.”

The first phase of the collaboration will be to determine the scale of a pilot plant to be based at the Port Kembla steelworks, consisting of a hydrogen electrolyser, direct reduction process and melter.

Rio Tinto told delegates at a recent investor seminar that it was focused on studying three potential pathways towards net neutral steelmaking; using sustainable biomass with Pilbara iron ore to replace coking coal in the iron and steelmaking process; using hydrogen-based hot-briquettes iron (HBI) with high-grade ores in Canada; and using hydrogen direct reduced iron (DRI) with a melter for Pilbara ores.

At the investor seminar, Rio Tinto also announced new targets of reducing its Scope 1 & 2 carbon emissions by 50% by 2030, more than tripling its previous target, and a 15% reduction in emissions by 2025, five years earlier than previously. These targets are supported by around $7.5 billion of direct investments in lower emissions between 2022 and 2030.