Tag Archives: steelmaking

BHP and POSCO to collaborate on low-carbon steelmaking technologies

BHP and South Korea’s POSCO have announced a Memorandum of Understanding (MoU) to jointly explore greenhouse gas emissions reduction technologies in integrated steelmaking.

As part of the MoU, the parties intend to undertake pilot and plant trials to lower carbon in the steelmaking process, including optimising coke quality and assessing carbon capture storage and utilisation (CCUS) options to lower carbon intensity in the blast furnace.

POSCO and BHP also intend to share research on hydrogen-based direct reduction technology, the use of biomass in steelmaking, as well as the potential to leverage BHP’s carbon offsetting capabilities in the development of carbon neutral steel products.

BHP intends to invest up to $10 million over the next five years under the MoU, with the opportunity to increase investment in technologies under the trial. BHP’s investment will be drawn from its $400 million Climate Investment Program, announced in 2019 to support projects, partnerships, research and development to help reduce Scope 1, 2 and 3 emissions.

BHP and POSCO also intend to collaborate on the reporting of carbon emissions through the steel value chain to further progress consistent, transparent and robust global standards.

BHP Chief Commercial Officer, Vandita Pant, said: “The pathway to net zero for steelmaking is not yet clear but we believe that, by working with industry leaders like POSCO, together we will find solutions more quickly to help reduce carbon emissions in steelmaking and along the value chain. BHP recently announced a goal to pursue net zero Scope 3 emissions by 2050 and we are committed to working with industry leaders in steelmaking to address this hard-to-abate sector.

“Steel is a critical product for the world to grow and decarbonise, and we must work hard together to enable greener steel, reducing carbon intensity in the blast furnace and testing new technologies for steel production.”

POSCO’s Head of Steel Business Unit, Hag-Dong Kim, said: “Though achieving carbon neutrality is a difficult path ahead, with POSCO working together with BHP’s outstanding mining expertise and the will to achieve a low-carbon future, I have every reason to believe that we can create a significant turning point in carbon emission reduction across our value chain.”

The MoU with POSCO follows BHP’s earlier partnerships established with major steelmakers China Baowu, JFE Steel and HBIS Group to explore emissions reduction from steelmaking. The combined output of the four steel companies equates to around 12% of reported global steel production.

Rio Tinto and Uni of Nottingham partner on biomass-backed low-carbon steelmaking project

Rio Tinto says it is progressing an innovative new technology to deliver low-carbon steel, using sustainable biomass in place of coking coal in the steelmaking process, in a potentially cost-effective option to cut industry carbon emissions.

Over the past decade, Rio Tinto has developed a laboratory-proven process that combines the use of raw, sustainable biomass with microwave technology to convert iron ore to metallic iron during the steelmaking process. The patent-pending process, one of a number of avenues the company is pursuing to try to lower emissions in the steel value chain, is now being further tested in a small-scale pilot plant.

If this and larger-scale tests are successful, there is the potential over time for this technology to be scaled commercially to process Rio Tinto’s iron ore fines, Rio said.

Rio Tinto Iron Ore Chief Executive, Simon Trott, said: “We are encouraged by early testing results of this new process, which could provide a cost-efficient way to produce low-carbon steel from our Pilbara iron ore. More than 70% of Rio Tinto’s Scope 3 emissions are generated as customers process our iron ore into steel, which is critical for urbanisation and infrastructure development as the world’s economies decarbonise. So, while it’s still early days and there is a lot more research and other work to do, we are keen to explore further development of this technology.”

Rio Tinto’s process uses plant matter known as lignocellulosic biomass, instead of coal, primarily as a chemical reductant. The biomass is blended with iron ore and heated by a combination of gas released by the biomass and high efficiency microwaves that can be powered by renewable energy.

Rio Tinto researchers are working with the multi-disciplinary team in the University of Nottingham’s Microwave Process Engineering Group to further develop the process.

The university’s Head of Department, Chemical and Environmental Engineering, Professor Chris Dodds, said: “It is really exciting to have the opportunity to be part of a great team working on a technology that, if developed to commercial scale, has the potential to have a global impact through decarbonising key parts of the steel production process.”

The use of raw biomass in Rio Tinto’s process could also avoid the inefficiencies and associated costs of other biomass-based technologies that first convert the biomass into charcoal or biogas, the company said.

Lignocellulosic biomass includes agriculture by-products (ie wheat straw, corn stover, barley straw, sugar cane bagasse) and purpose-grown crops, which would be sustainable sources for the process. Importantly, the process cannot use foods such as sugar or corn, and Rio Tinto says it would not use biomass sources that support logging of old-growth forests.

Trott added: “We know there are complex issues related to biomass sourcing and use and there is a lot more work to do for this to be a genuinely sustainable solution for steelmaking. We will continue working with others to understand more about these concerns and the availability of sustainable biomass.”

If developed further, the technology would be accompanied by a robust and independently accredited certification process for sustainable sources of biomass, Rio said.

HYBRIT partners produce world’s first hydrogen-reduced sponge iron

SSAB, LKAB and Vattenfall say they have now produced the world’s first hydrogen-reduced sponge iron at a pilot scale.

The technological breakthrough in the HYBRIT initiative captures around 90% of emissions in conjunction with steelmaking and is a decisive step on the road to fossil-free steel, the partners say.

The feat from the HYBRIT pilot plant in Luleå, Sweden, showed it is possible to use fossil-free hydrogen gas to reduce iron ore instead of using coal and coke to remove the oxygen. Production has been continuous and of good quality, the companies said, with around 100 t made so far.

This is the first time ever that hydrogen made with fossil-free electricity has been used in the direct reduction of iron ore at a pilot scale, according to the HYBRIT partners. The goal, in principle, is to eliminate carbon dioxide emissions from the steelmaking process by using only fossil-free feedstock and fossil-free energy in all parts of the value chain.

Hydrogen-based reduction is a critical milestone, which paves the way for future fossil-free iron and steelmaking. SSAB, LKAB and Vattenfall intend, through HYBRIT, to create the most efficient value chain from the mine to steel, with the aim of being first to market, in 2026, with fossil-free steel at an industrial scale, they say.

Last year, HYBRIT, a joint initiative of SSAB, LKAB and Vattenfall, began test operations to make hydrogen-reduced sponge iron in the pilot plant built with support from the Swedish Energy Agency. The technology is being constantly developed and the sponge iron that has been successfully made using hydrogen technology is the feedstock for the fossil-free steel of the future, they say.

Jan Moström, President and CEO at LKAB, said: “This is a major breakthrough both for us and for the entire iron and steel industry. LKAB is the future supplier of sponge iron and this is a critical step in the right direction. Progress with HYBRIT enables us to maintain the pace in our transition and, already in 2026, we will begin the switch to industrial-scale production with the first demonstration plant in Gällivare, Sweden. Once LKAB has converted its entire production to sponge iron, we will enable the transition of the steel industry and reduce global emissions by around 35 Mt a year, which corresponds to two thirds of Sweden’s entire emissions. This is the greatest action we can take together for the good of the climate.”

Martin Lindqvist, President and CEO at SSAB, added: “This technological breakthrough is a critical step on the road to fossil-free steel. The potential cannot be underestimated. It means that we can reach climate goals in Sweden and Finland and contribute to reducing emissions across Europe. At the same time, it creates new jobs and export successes. SSAB’s transition means we will reduce carbon dioxide emissions by 10% in Sweden and 7% in Finland. High-strength fossil-free steel will also allow us to help our customers to strengthen their competitiveness. As early as this year, we will deliver minor quantities of steel made using hydrogen-based reduction to customers, and in 2026 we will deliver fossil-free steel at a large scale.”

The hydrogen used in the direct reduction process is generated by electrolysis of water with fossil-free electricity, and can be used immediately or stored for later use, according to the partners. In May, HYBRIT began work on building a pilot-scale hydrogen storage facility adjacent to the direct reduction pilot plant in Luleå.

Anna Borg, President and CEO at Vattenfall, said: “Sweden’s and Vattenfall’s fossil-free electricity is a basic requirement for the low carbon footprint of hydrogen-reduced sponge iron. The breakthrough that we can announce today shows in a very real way how electrification contributes to enabling a fossil-free life within a generation.”

HYBRIT partners choose Gällivare for fossil-free sponge iron demonstration plant

SSAB, LKAB and Vattenfall say they are taking a new, decisive leap forward in their work on HYBRIT, with the trio selecting Gällivare, in northern Sweden, as the location of the first production plant for its fossil-free sponge iron exercise.

Industrialisation is intended to start with the first demonstration plant, which will be ready in 2026, for the production of 1.3 Mt of fossil-free sponge iron in Gällivare. The demonstration plant will be integrated with iron pellet making and is part of LKAB’s transition plan.

The goal is to expand sponge iron production to a full industrial scale of 2.7 Mt by 2030 to be able to supply SSAB, among others, with feedstock for fossil-free steel. The choice of Gällivare for the demo plant was based on a joint assessment of industrial synergies, where proximity to iron ore, logistics, an electricity supply and energy optimisation were important factors, the companies said.

There are many advantages to locating the new sponge iron plant in Gällivare, which is also near LKAB’s mining production and processing plants. Using iron ore pellets that are already warm in the process will save huge amounts of energy, according to the companies. On top of this, 30% of weight will be eliminated from transport since hydrogen gas will be used to remove the oxygen in the iron ore. Gällivare also offers good access to fossil-free electricity from Vattenfall.

Martin Lindqvist, President and CEO at SSAB (centre), said: “We are world leaders in the work to transform the steel industry and are now stepping up the pace. We are doing this for the climate, customers, competitiveness and for employment. That we are now raising ambitions for a completely fossil-free value chain is unique and a message of strength from SSAB and our HYBRIT partners. We are seeing a clear increase in demand for fossil-free steel and it is right to speed up our ground-breaking cooperation.”

Jan Moström, President and CEO at LKAB (left), said the companies are leading the transformation of the iron and steel industry.

“The whole process starts with top quality iron ore in the mine and our transition plan gives strong economies of scale that pave the way for the competitive production of fossil-free steel by our customers,” he said. “This is the greatest thing we can do together for the climate. Once we are ready, we will reduce the global emissions of our customers by 35 Mt a year, which is equivalent to triple the effect of parking all passenger cars in Sweden for good.”

At the same time as announcing the Gällivare demo plant, SSAB and LKAB have agreed to deepen their partnership to create the “most effective fossil-free steel value chain from mine to steel, to customer”, they said.

“We will support and enable each other’s transformation, with Vattenfall an enabler of the huge need for electricity and hydrogen gas,” they said. “On the back of an acceleration of HYBRIT, together with LKAB’s strategy and deeper partnership, SSAB will now explore the prerequisites to convert to fossil-free steel production in Luleå faster than planned.”

The plan to convert its Oxelösund steel works in 2025 remains unchanged, as does its goal to be the first to market, in 2026, with fossil-free steel, SSAB clarified.

Anna Borg (right), President and CEO at Vattenfall, added: “Sweden and HYBRIT have a world-leading position in making fossil-free iron- and steelmaking a reality and the initiative will now be further scaled up. That fossil-free electricity and ground-breaking processes will in principle help to eliminate climate-affecting emissions completely from iron- and steelmaking is a flagship example of Vattenfall’s strategy to enable a fossil-free life within a generation. It is now extra important that the permit processes can deliver at the same pace as fossil-free steelmaking.”

Hybrit Development AB, which is owned by SSAB, LKAB and Vattenfall, is developing the technology to make steel using hydrogen gas instead of coal, which will minimise climate harmful carbon dioxide emissions from production. The HYBRIT pilot plant will be able to make fossil-free sponge iron to make fossil-free steel for prototypes to customers already in 2021.

The partners claim the initiative has the potential to reduce carbon dioxide emissions by 10% in Sweden and 7% in Finland, as well as contribute to cutting steel industry emissions in Europe and globally.

Rio’s IOC to supply high-grade iron ore for low-carbon steel feedstock project

Rio Tinto, Paul Wurth SA and SHS-Stahl-Holding-Saar GmbH & Co (SHS) have signed a memorandum of understanding to explore the production of a low-carbon steel feedstock.

This partnership brings together a leading global miner, an international leader in the design and supply of engineering solutions for integrated steelmakers and one of Europe’s best-known steelmakers, Rio said.

The partnership will explore the viability of transforming iron ore pellets into low-carbon hot briquetted iron (HBI), a low-carbon steel feedstock, using green hydrogen generated from hydro electricity in Canada.

Iron Ore Company of Canada (IOC), in which Rio Tinto holds a majority interest, will supply high-grade iron ore and expertise in mining, processing and pelletising. Paul Wurth brings expertise in plant building and process knowledge in the field of highly efficient hydrogen generation and MIDREX® direct reduction plants. SHS brings iron- and steelmaking expertise.

Rio Tinto’s significant presence in the Canadian provinces of Quebec and Newfoundland and Labrador makes Canada a natural location for the project, it said.

“Canada provides access to cost competitive hydro electricity, and proximity to key markets in Europe and North America,” the company said. “Transforming high-grade iron ore pellets into a low-carbon steel feedstock using green hydrogen, when processed in an electric arc furnace with carbon free electricity, has the potential to reduce significantly the carbon emissions associated with steelmaking.”

The parties will conduct a feasibility study into the potential development of industrial-scale low-carbon iron production in Canada, using the combined expertise of the three partners across the entire steel value chain. The feasibility study is scheduled for completion in late 2021, with an investment decision on a hydrogen-based direct reduction plant at industrial scale expected to follow thereafter.

IOC President and CEO, Clayton Walker, said: “This partnership is part of Rio Tinto’s climate strategy to pursue proactive and action-oriented partnerships to support the development and deployment of low-carbon technologies for hard-to-abate processes like steelmaking.

“We are absolutely committed to being part of the solution on climate change and to support our customers and other stakeholders in the steel value chain as the industry transitions to a low-carbon future.”

Georges Rassel, CEO of Paul Wurth SA, said: “By associating the different players of the metal production chain, we are confident to develop the most appropriate and efficient solutions for this challenging transition towards a carbon-neutral industry.”

Martin Baues, Member of the Board of Directors for Technology at SHS-Stahl-Holding Saar, said: “Dillinger and Saarstahl adopted a future-focused strategy with the motto ‘proactive, carbon-free and efficient’. Within this strategy, we have defined various options for the transformation to carbon-neutral steel production. The use of hydrogen in steel production is a key factor in reducing carbon emissions. This partnership can further help us to reduce our carbon emissions on the basis of this technology, while gaining important experience in using hydrogen in steel production.”

Kobe Steel demonstrates new, cleaner steel production technology

Kobe Steel says it has successfully demonstrated technology that can significantly reduce CO2 emissions from blast furnace operations, combining the technologies of Midrex in the engineering business and the blast furnace operation technology in the iron and steel business.

This achievement is a result of the integrated efforts of the Kobe Steel Group (also known as the KOBELCO Group) leveraging its diverse businesses, it said. The demonstration test was conducted for a month at a large blast furnace (4,844 cu.m) of the Kakogawa Works in Hyogo Prefecture, Japan, in October 2020.

The quantity of CO2 emissions from the blast furnace is determined by the reducing agent rate (RAR), or the quantity of carbon fuel used in blast furnace ironmaking. In the demonstration test, it was verified that RAR could be stably reduced from 518 kg per tonne of hot metal (thm) to 415 kg/thm by charging a large amount of hot briquetted iron produced by the MIDREX® Process. The results indicate that this technology can reduce CO2 emissions by approximately 20% compared with the conventional method, the company said.

In addition, the world’s lowest level of coke rate (239 kg/thm) has been achieved in the demonstration test of this technology, the company claimed.

Kobe Steel sees this as a promising solution that could become readily available soon at a lower additional cost compared with other CO2-reduction measures.

The MIDREX Process uses natural gas as the reductant and pellets made of iron ore as the source of iron to make direct reduced iron through the reduction process in the shaft furnace. In comparison with the blast furnace method, the MIDREX Process can reduce CO2 emissions by 20-40%.

The company said: “We will keep improving this CO2-reduction solution technology while further reducing CO2 emissions and achieving lower costs for CO2 reduction. Beyond our own efforts to reduce emissions from our facilities, we will strive to contribute to the acceleration of CO2 reduction through introducing this solution to blast furnaces around the world.

“In addition, we believe that the success of the demonstration test on an actual blast furnace has made a significant step forward in providing low CO2 steel products to customers. As moving forward with our environmental efforts on the scale of the whole supply chain, we will establish production and sales systems and define the terms and conditions for sales so that we can provide customers with low CO2 steel products that offer new added value.”

BHP, JFE Steel to scrutinise Australian steel raw materials emissions in latest study

BHP has signed a memorandum of understanding (MoU) with leading Japanese steel producer, JFE Steel, to jointly study technologies and pathways capable of making material reductions to greenhouse gas emissions from the integrated steelmaking process.

BHP is prepared to invest up to $15 million over the five-year partnership, which, it says, builds on the strong history of technical research and collaboration between the two companies.

The company’s investment will be funded under its $400 million Climate Investment Program, set up in 2019 to coordinate and prioritise projects, partnerships, R&D and venture investments to reduce Scope 1, 2 and 3 emissions, invest in offsets and support development of technologies with the highest potential to impact change.

The JFE-BHP partnership will focus on the role of Australian raw materials to help to increase efficiency and reduce emissions from the blast furnace and direct reduced iron (DRI) steelmaking routes, it said. The partnership intends to study the properties of raw materials, with focus on specific areas such as iron ore pre-treatment, use of enhanced iron ore lump, high quality coke and DRI, required to decrease iron and steelmaking emissions and support a transition to a low carbon future. Throughout the collaboration, the two companies will also share knowledge on reducing carbon emissions across the steel value chain.

This JFE-BHP partnership follows other BHP investments to support the reduction of value chain emissions, including up to $35 million for the collaboration with China’s largest steelmaker, China Baowu, and awarding BHP’s first LNG-fuelled Newcastlemax bulk carriers contract, with the aim to reduce CO2-e emissions by 30% per voyage.

BHP’s Chief Commercial Officer, Vandita Pant, said: “This partnership with JFE demonstrates a joint commitment to make our activities more sustainable through collaboration and technological improvement. This work will support and help progress Japan’s carbon neutral ambitions by 2050.”

As outlined in BHP’s decarbonisation framework, the steel industry is expected to move through stages of optimisation and transition for the existing integrated steelmaking route before reaching an end state of low or no carbon intensity.

“Our investments are focused on actions that can create real change, and we continue to take positive steps on our climate agenda and in collaborating with others to help reduce emissions in line with the Paris Agreement goals,” Pant said.

JFE’s President and Chief Executive Officer, Yoshihisa Kitano, said: “We understand that raw material processing technology is extremely important in the research and development towards carbon neutrality. We have a long history working closely together with BHP collaborating to study raw material utilisation technology and mine development. It is very significant for us to be able to work together with BHP towards reduction of CO2 emissions, which is an extremely important agenda for the steel making sector.”

BHP and China Baowu take on steel industry GHG emission reduction challenge

BHP has signed a memorandum of understanding (MoU) with leading steel producer, China Baowu, with the intention, it says, to invest up to $35 million and share technical knowledge to help address the challenge of reducing greenhouse gas emissions facing the global steel industry.

The five-year partnership will focus on the development of low carbon technologies and pathways capable of emission intensity reduction in integrated steelmaking, according to BHP. Under the MoU, the deployment of carbon capture, utilisation and storage in the steel sector will also be investigated at one of China Baowu’s production bases.

BHP’s investment will be funded under the $400 million Climate Investment Program, set up last year to coordinate and prioritise projects, partnerships, R&D and venture investments to reduce Scope 1, 2 and 3 emissions, offsets and support development of technologies with the highest potential to impact change.

BHP Chief Executive Officer, Mike Henry (pictured left), said the companies would collaborate on technical solutions to use low carbon fuel sources such as hydrogen injection in the blast furnace, and explore other low emission options in support of China Baowu and the steel industry’s low carbon transformation and green development goals.

“This MoU further strengthens our longstanding relationship with China Baowu and reflects our joint determination and commitment to help reduce emissions in line with the Paris Agreement goals,” Henry said.

“BHP will invest in supporting the development of low emissions technologies, promote product stewardship and partner with others to enhance the global policy and market response to climate change. Our investments are focused on actions that can create real change in emissions.”

In September, BHP awarded a tender for world’s first LNG-fuelled Newcastlemax bulk carrier to carry iron ore between Western Australia and China, which will reduce emissions by more than 30% per voyage.

In October 2019, China Baowu, meanwhile, announced the establishment of a Low Carbon Metallurgy Innovation Centre and plans to establish a Global Low Carbon Metallurgy Innovation Alliance.

China Baowu Chairman, Chen Derong, said the MoU with BHP will further enhance and broaden the existing strategic partnership between the companies, and establish a model of joint industrial efforts to promote technological innovation and a sustainable transition to a lower carbon world.

“At the UN General Assembly, President Xi Jinping delivered an important speech that outlined China’s low carbon transformation and development,” Chen Derong said. “Low carbon transition and green development represent a major disruption to the traditional steelmaking value chain.

“As a leading company in the sector, China Baowu will take an active role in implementing low carbon technologies, working together with upstream and downstream partners.

“The global steel industry needs an open platform to jointly explore low carbon technology and roadmaps, as well as showcase to the world the efforts to reshape the steelmaking value chain.”

Consistent with the ambitions of China Baowu and BHP to drive efficiency and address emissions across the global steel industry, both companies will work together to establish a China Baowu-BHP Low Carbon Metallurgy Knowledge Sharing Center, to link complementary research and share low carbon and green development knowledge with domestic and international steel industry stakeholders, the two companies said.

BHP weighs trolley assist and IPCC as part of decarbonisation efforts

BHP has provided an update on its progress on climate action, new climate commitments and how it integrates climate change into corporate strategy and portfolio decisions in a new report.

The company’s climate change approach focuses on reducing operational greenhouse gas emissions, investing in low emissions technologies, promoting product stewardship, managing climate-related risk and opportunity, and partnering with others to enhance the global policy and market response, it says.

“BHP supports the aim of the Paris Agreement to limit global warming to well below 2°C above pre-industrial levels, and pursue efforts to limit warming to 1.5°C,” the company clarified.

It explained: “BHP has been active in addressing climate risks for more than two decades, and has already established its long-term goal of achieving net zero operational (Scope 1 and 2) emissions by 2050 and its short-term target of maintaining operational emissions at or below financial year (FY) 2017 levels by FY2022, using carbon offsets as required.”

In the past year, BHP has made progress on this aim, announcing that the Escondida and Spence copper mines in Chile will move to 100% renewable energy by the mid-2020s, and, last week, awarding new renewable energy contracts for its Queensland coal assets, and the world’s first LNG-fuelled Newcastlemax bulk carrier tender.

BHP’s climate change briefing and 2020 climate change report outline how the company will accelerate its own actions and help others to do the same, it said. Today’s update sets out:

  • A medium-term target to reduce operational greenhouse gas emissions by at least 30% from adjusted FY2020 levels by FY2030;
  • Scope 3 actions to contribute to decarbonisation in its value chain. This includes supporting the steelmaking industry to develop technologies and pathways capable of 30% emissions intensity reduction with widespread adoption expected post-2030 and, in terms of transportation, supporting emissions intensity reduction of 40% in BHP-chartered shipping of products;
  • Strengthened linking of executive remuneration to delivery of BHP’s climate plan; and
  • Insight into the performance of BHP’s portfolio in a transition to a 1.5°C scenario.

The report also outlined some examples of emission reduction projects the miner is considering, which will be weighed as part of the maintenance capital category of its capital allocation framework. This includes solar power installations; alternative material movement technologies such as overland conveyors and in-pit crush and convey solutions; and trolley assist to displace diesel for haul trucks.

The company expanded on this in its report: “The path to electrification of mining equipment will likely include solutions such as trolley assist, in-pit crush and convey, overland conveyors and battery solutions.

“Diesel displacement represents a higher risk, higher capital step towards decarbonisation, so a phased approach to execution is proposed with particular emphasis on Minerals Americas-operated assets that are further advanced on the decarbonisation journey. Taking a transitional approach to electrification provides flexibility to allow for the potential for rapid development of emerging technologies and to resolve the complexities of integrating these technologies into existing operations.

“During FY2021, we will seek to collaborate further with International Council on Mining and Metals members, industry and original equipment manufacturers to progress research and development to reduce costs and assess any potential impacts from electrified mining equipment solutions to replace current diesel options.”

BHP Chief Executive Officer, Mike Henry, said of the report: “I’m pleased today to show how we are accelerating our own actions and helping others to do the same in addressing climate change. We see ourselves as accountable to take action. We recognise that our investors, our people and the communities and nations who host our operations or buy our products have increasing expectations of us – and are responsive to these.

“Our approach to climate change is defined by a number of key requirements. Our actions must be of substance. They must be real, tangible actions to drive emissions down. We must focus on what we can control inside our business, and work with others to help them reduce emissions from the things that they control. To create long-term value and returns over generations, we must continue to generate value and returns within the strong portfolio we have today, while shaping our portfolio over time to benefit from the megatrends playing out in the world including decarbonisation and electrification.

“Our portfolio is well positioned to support the transition to a lower carbon world aligned with the Paris Agreement. Our commodities are essential for global economic growth and the world’s ability to transition to and thrive in a low carbon future. Climate change action makes good economic sense for BHP and enables us to create further value.”

GFG Alliance to take over TEMCO manganese alloy smelter following South32 pact

South32’s association with the Tasmanian Electro Metallurgical Company (TEMCO) is set to come to an end after it agreed to sell its stake in the manganese alloy smelter to an entity within the GFG Alliance.

The announcement from South32’s Groote Eylandt Mining Company (GEMCO) said completion of the transaction was subject to approval from Australia’s Foreign Investment Review Board. Upon satisfaction of this condition, GFG will make a nominal payment to GEMCO to acquire 100% of the shares in TEMCO, it said, without naming an acquisition price.

As a condition to the completion of the transaction, the parties have entered into an ore supply agreement from GEMCO to TEMCO.

The smelter, in Tasmania, Australia, is run by the Samancor Manganese joint venture, owned 60% by South32 and 40% by Anglo American.

South32 says TEMCO uses ore shipped from its GEMCO operations in the Northern Territory of Australia and produces ferromanganese for steelmaking. Most of the alloy produced is exported to customers in Asia and North America, with the remaining sold to steel producers in Australia and New Zealand.

South32 CEO Graham Kerr said the agreement represented another milestone for South32 as it continues to reshape its portfolio.

“Today’s agreement follows an extensive review of options regarding the future of our manganese alloy business,” he said.

“The transaction and our ongoing supply of ore to TEMCO will see the smelter, first established in 1962, continue to operate into the future.

“Looking forward, we are confident that GFG, a current TEMCO customer, is well placed to operate the smelter, with the acquisition representing an opportunity to further vertically integrate its steel business.”

The transaction does not include the Samancor Manganese JV’s South African manganese alloy smelter, Metalloys, which has separately been placed under care and maintenance, South32 added.