Rio Tinto and China Baowu, the world’s largest iron ore producer and steelmaker, respectively, announced today the launch of a partnership aimed at decarbonizing the steel value chain.
Demand for low carbon steel is expected to increase significantly, over the next several years, as manufacturers globally aim to decarbonize their supply chains. Steelmaking is one of the biggest emitters of CO2 globally, and one of the more challenging sectors to abate, with total greenhouse gas emissions (GHG) from the sector accounting for 7% – 9% of direct emissions from the global use of fossil fuels.
Rio Tinto’s Chief Commercial Officer Alf Barrios said:
“Rio Tinto and China Baowu are united in a commitment to accelerating the delivery of low-carbon solutions for the entire steel value chain. This MoU aims to address one of the biggest challenges faced by the industry – developing a low-carbon pathway for low-to-medium grade iron ores, which account for the vast majority of global iron ore supply.”
The new partnership will focus on a series of projects in China and Australia. Projects will include an electric melter at one of Baowu’s steel mills in China enabling low carbon steelmaking using Direct Reduced Iron (DRI) produced from low and medium grade ores, optimizing pelletisation technology for Australian ores as a feedstock for low-carbon shaft furnace-based direct reduction, and expanding the development of China Baowu’s HyCROF (Hydrogen-enriched Carbon Cycle and Oxygen) technology aimed at mitigating carbon emissions from blast furnaces. The companies will also study opportunities to produce low carbon iron in Western Australia.
In a statement announcing the partnership, China Baowu said:
“With the mission of building an industrial ecosystem to promote the progress of human civilisation, China Baowu is committed to working with Rio Tinto to jointly study and provide low-carbon and green comprehensive solutions for the steel value chain, help the low-carbon transformation and upgrade of the steel industry chain, and support the world to address the challenge of climate change with pragmatic actions.”
The new partnership follows the launch in September 2022 by Rio Tinto and China Baowu of a $2 billion joint venture to develop the Western Range iron ore project in the Pilbara, Western Australia.
Rio Tinto’s Chief Executive of Iron Ore Simon Trott said:
“Our relationship with China Baowu in Western Australia has been a proud and successful one, extending back more than 40 years. We look forward to progressing this study into the potential of low-carbon iron making in Western Australia as we work to ensure a positive future for Pilbara ores in a green steel world.”