Large-scale production of green iron in WA could reduce global emissions by 1.2 per cent by 2050 – effectively offsetting nearly every tonne of CO2 currently produced in Australia – while generating $74 billion in economic value and supporting 19,600 direct jobs.
That is the key takeaway from a new report released today by the Chamber of Minerals and Energy WA (CME) that examines the State’s potential to play a leading role decarbonising the emissions-intensive steelmaking process.
CME Chief Executive Officer Rebecca Tomkinson said WA boasted a long history as the world’s largest iron ore exporter and had a unique opportunity to advance down the value chain if the State can begin refining green iron.
“Steelmaking accounts for between 6 to 9 per cent of global emissions, with ironmaking alone generating up to 90 per cent of that CO2,” Ms Tomkinson said.
“WA’s major iron ore producers are already exploring several new pathways to drastically reduce those emissions with promising early results.”
The report, which relies on analysis by Mandala Partners, identifies both the opportunities and actions required to capitalise on WA’s green iron potential.
Transformational reductions in ironmaking emissions will require plentiful and affordable low emission energy and the commercialisation of new technologies and processes. These are cutting edge technologies that will need to be proven for WA ores.
Under a prospective hydrogen-based ironmaking process examined in the report, investment of $37.5 billion is required by 2030 to produce an initial 4.5Mt of green iron.
The combined public and private investment would be spent on new energy infrastructure, green hydrogen and green iron production facilities, desalination plants and upgraded ports and roads.
“There are massive rewards on offer if we can get this right,” Ms Tomkinson said.
“Not only would it create tens of thousands of jobs and safeguard the future of our world-leading iron ore industry, producing green iron at scale would remove hundreds of millions of tonnes of global emissions.
“The impact is so large that if WA supplied 218Mt of green iron by 2050 – using about 40 per cent of the iron ore we produce today – global emissions would fall by 1.2 per cent.
“That would mean offsetting nearly every single tonne of Australia’s current 465Mt of domestic CO2 emissions.
In the nearer term, producing higher-grade iron ores like magnetite can reduce net steelmaking emissions today, with some products capable of reducing lifecycle emissions by around 10 per cent via existing production pathways.
“Ensuring the right policy and regulatory settings to unlock WA’s magnetite reserves is another key part of the decarbonisation puzzle,” Ms Tomkinson said.
The report’s 2030 Action Plan outlines three key priority areas for Government.
They include expanding R&D support, tax incentives and grants to fast-track Australian green iron technology and commercialisation, boosting government investment in lowering the cost of low-emissions energy and developing common-user infrastructure.
Fortescue Executive Chairman Dr Andrew Forrest:
“The world needs green iron. It will help ensure we can avert the most catastrophic, irreversible impacts of climate change.
“For Australia, it presents a once in a generation economic opportunity to build what could be our largest ever single industry, generating billions of dollars annually and creating thousands of highly paid jobs for generations of West Australians.
“Right now, there are other forward-thinking countries lining up to seize our green metals advantage. It is therefore imperative that Government joins industry in seizing this opportunity.”
“This report, in our view, provides a very conservative perspective on the economic opportunity for Western Australia. Our recent discussions in China make us feel confident that the opportunities are in fact much greater. With the right vision and support from government, we could be producing very significant quantities of green iron before 2030, securing Western Australia’s prosperity for generations to come.”
Rio Tinto Iron Ore Chief Executive Simon Trott:
“Rio Tinto is working on a range of projects with our customers and suppliers to reduce the carbon intensity of steelmaking, which contributes 8% of the world’s carbon emissions.
“We also recognise the task requires a collaborative effort, so we’re working with industry to find better ways to develop technology to produce less carbon intensive steel.”
BHP Asset President WA Iron Ore Tim Day:
“It’s fantastic to see the CME’s Green Iron Report shine a light on some of the work we’ve been doing in the lab and with our partners for several years now.
“It will take a united front to help fast-track near-zero emission-intensity pathways for steelmakers using Pilbara ores, but we think the potential outcomes could be game-changing.
“If we get it right, it could be a major step forward in setting up WA, Australia, and the world for a low greenhouse gas emission future.”
CITIC Pacific Mining Chairman and CEO Chen Zeng:
“Apart from identifying the pathway to achieve long-term green iron ambitions, this report’s recommendations recognise the contribution WA’s emerging magnetite sector is already making to decarbonisation of the steel industry.
“Right here and right now, investment in iron ore value-adding in this State is helping deliver lower emissions across the steel cycle – from the local mine pit to final overseas product.
“Emissions don’t stop at national boundaries. It’s critical we have policy settings which encourage the high-grading of WA’s very significant endowment of magnetite ore, in support of the energy transition.”
BACKGROUND
For the purposes of this report, and in line with the proposed definition for green steel under the International Energy Agency’s Breakthrough Agenda Report, green iron refers to iron produced in a near-zero emissions manner.
Media contacts:
Josh Zimmerman j.zimmerman@cmewa.com / 0404 947 719
Natasha Mutch n.mutch@cmewa.com / 0435 383 382
