Hydrogen

These billionaires believe green hydrogen will offer a carbon-free future for iron ore mining

  • Carbon-free green hydrogen is being welcomed by iron ore miners for home-grown steel and iron pellet production
  • ASX company Iron Roadway to sign up with FMG and GFG Alliance as green hydrogen iron ore business in Australia
  • ‘‘ The production of ‘green pellets’ offers Iron Roadway the opportunity to diversify its item streams’ Iron Road stated

Andrew Forrest’s groundbreaking weekend speech heralding Fortescue Metals Group’s (ASX: FMG) move into the green hydrogen market for the production of steel grabbed headings.

The FMG chairman described how Australia could slash CO2 emissions and develop a new nation-building sector by changing nonrenewable fuel sources like coal with hydrogen in zero-carbon steel production.

FMG plans to have Australia’s first green steel pilot plant up and running in WA’s Pilbara area in the next couple of years. It will be powered by green electrical power, both wind and solar.

Fellow billionaire industrialist Sanjeev Gupta and his GFG Alliance group of companies prepare to produce green steel in a modern center at the Whyalla steelworks in South Australia that will at first work on gas, and later on hydrogen.

“All of our energy jobs will be part of an industrial improvement to carbon neutrality,” Gupta told The Australian paper.

ASX junior Iron Roadway establishing iron ore pellet plant fuelled by green hydrogen

A small ASX iron ore company, Iron Road (ASX: IRD), is also developing a green hydrogen task for iron ore pellet production in South Australia’s proposed Cape Hardy port.

The job might act as a model for green hydrogen jobs in Australia’s iron ore sector as it ideally moves from the drawing board and into truth over the next couple of years.

Hydrogen Utility (H2U), a designer of green hydrogen jobs in Australia, is a partner in the job, as is Japanese engineering and innovation business Mitsubishi Heavy Industries.

The business’s chief executive Larry Ingle told Stockhead about the project and the reasons underlying Iron Road’s investment in green hydrogen.

Why has Iron Road decided to find its green iron ore pellet plant in the Cape Hardy precinct? Why did it decide to decrease the route of utilizing hydrogen in its production process?

“Iron Roadway and H2U are cooperating to examine the production and ultimate export of green hydrogen/green ammonia from the port to be developed at Cape Hardy,” Ingle said.

“H2U has the copyright on the hydrogen generation innovation and a respected Japanese partner in Mitsubishi Heavy Industries (MHI).”

“Iron Road acknowledges the potential for green hydrogen in time to revolutionise and assist in decarbonising the power and processing markets.”

“Iron Roadway and H2U have a cooperation contract, where H2U and its partner will develop the hydrogen generation facility.”

“Iron Road will be exporting high grade iron concentrate (magnetite) from the port at Cape Hardy.”

“The chance to produce green pellets, in addition to exporting iron concentrate, is viewed as a value including action in the provision of iron making precursors.”

“The distinct advantages used by the proposed port at Cape Hardy is driving these value including chances to be examined,” said Ingle.

Can you discuss the attraction of the Cape Hardy location for the business? Is it to do with the South Australian government’s policy to promote hydrogen-based industries? Is it a deep water port, or have any other infrastructure advantages?

“The Cape Hardy area was selected by Iron Road for the development of a bulk products port, through an intensive analysis of the available locations around the Eyre Peninsula,” Ingle said.

“The Cape Hardy place uses a number of advantages: being on the lee side of the Eyre Peninsula the website provides reasonably calm seaside waters within the Spencer Gulf, naturally deep water close to coast with no requirement for dredging, good landside topography, and is unencumbered by marine coastal reserves or aquaculture.

“The geographical place is ideal to service the whole Eyre Peninsula.

“Federal government interest in Cape Hardy and the viability of the port precinct for green hydrogen has actually come well after Iron Roadway got land at Cape Hardy, supporting the Business’s belief on the port’s ideal location and other highly preferable qualities.

“The Eyre Peninsula has all the needed characteristics to produce green hydrogen.

“There is massive wind and solar resources, and the export of hydrogen will need big ships from deep water ports devoid of city encroachment.

“Iron Road has been in discussions with H2U for several years about the potential for hydrogen production at Cape Hardy and the possibility to include worth to the magnetite item and the Central Eyre Iron Project (CEIP) is a strong motivator.

“A current prospectus by the South Australia State Federal government identifies Cape Hardy as one of three locations ideal for green hydrogen advancement,” stated Ingle.

Is iron ore pellet production more affordable using hydrogen compared with other fuels? Are there significant expense savings from utilizing hydrogen? Are there other advantages to hydrogen such as low carbon emissions or other benefits?

“Possible production of hydrogen by H2U for export and the production of a top quality iron ore concentrate by Iron Road, offers a special set of scenarios where production of ‘green pellets’ might be advantageous,” Ingle stated.

“The hydrogen will be utilized to produce power needed for the production of pellets and also the fuel to indurate (cook, roast etc) the pellets.

“Conventionally, the power and cooking would be stemmed from carbon-based systems.

“With the advantages of the Eyre Peninsula for producing hydrogen and the CEIP producing a top-quality concentrate, the synergies need examination.

“It is expected that ‘green pellets’ would attract a premium price.

“The expense of utilizing hydrogen versus other fuels will belong to the master planning process to be undertaken by H2U and MHI at Cape Hardy.

“The area of a hydrogen electrolyser at Cape Hardy will bring together a number possible value including chances.

“Hydrogen will offer fuel for cooking pellets and power for producing pellets. These include worth and reduce carbon emissions,” said Ingle.

Which markets is Iron Road targeting for its green iron ore pellet production? When does the business’s Central Eyre Iron Project go into production and what will be its preliminary and long run capabilities?

“Financial investment in green iron ore pellet production at Cape Hardy would likely include end users from Japan, South Korea, and others in the region, where targets associating with the use of green hydrogen, other renewables and emissions are mandated by federal government,” Ingle stated.

“Steel plants powered partially or entirely by green hydrogen and supplied with ‘green pellets’ will can producing ‘green steel’ and satisfy or go beyond CO2 emission requirements set by governments as part of a low carbon future.

“Iron Road is actively seeking financiers in the CEIP, which will produce a premium and high-grade iron concentrate.

“Due to the big size of the magnetite orebody at Warramboo, the proposed mine will have a long mine life exceeding 30 years at whatever scale of mining adopted.

“A production rate of 12 million tonnes annually is imagined, producing an iron concentrate with a grade of 67% Fe.

“The concentrate is demanded for steel-making due to its homes and low impurities. The production of ‘green pellets’ deals Iron Roadway the chance to diversify its product streams,” Ingle stated.

South Australia appears to be on track to end up being Australia’s new province for iron ore production with a great deal of projects planned for the region. Exist any market forces at work that are driving this growth?

“South Australia is the birth place of iron ore mining in Australia and has large undeveloped iron ore resources (generally magnetite),” Ingle said.

“Increasing seaborne demand, still primarily driven by China, is expected to continue a minimum of in the short- to medium-term, resulting in continued strong rates.

“Magnetite ores, although costing more to process, produce a high-grade product, totally free of impurities that draw in a cost premium over the benchmark 62% Fe price.

“Steelmakers pay premiums for high grade focuses and pellets for feedstock mixing functions or for direct usage,” specified Ingle.

ASX share price for Iron Roadway (ASX: IRD)

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