BHP has signed a Memorandum of Understanding (MOU) with China’s HBIS Group Co., Ltd, one of the world’s largest steelmakers and a major steel customer of BHP’s iron ore, with the intention of investing up to US$15 million over three years to jointly study and explore greenhouse gas emissions reduction technologies and pathways.
Under the partnership, BHP and HBIS Group intend to collaborate on three priority areas: hydrogen-based direct reduction technology, the recycling and reuse of steelmaking slag, and the role of iron ore lump utilisation to help reduce emissions from ironmaking and steelmaking.
The partnership aims to help both companies progress toward their climate change goals, and support the steel industry’s role in helping to achieve China’s ambitions to be carbon neutral by 2060.
BHP’s Chief Commercial Officer, Vandita Pant, said the company views decarbonisation of the steel industry as a complex puzzle that requires multiple technological solutions across the value chain over different time horizons.
“By forming this third low-carbon steelmaking partnership with HBIS Group, we are focusing on additional components, such as the role our products play in hydrogen-based steel production, that complement our other partnerships and support for endeavours in emissions reduction and capture from the traditional blast furnace route.”
BHP’s investment would be drawn from its US$400 million Climate Investment Program established in 2019 to support projects, partnerships, research and development to help reduce Scope 1, 2 and 3 emissions.
BHP Chief Executive Officer, Mike Henry, added that BHP is pleased to establish the strategic partnership to explore new ways to reduce emissions from steelmaking.
“Global decarbonisation will require collaboration and collective effort, and our work with partners such as HBIS Group will build on our own actions and help reduce emissions right through the value chain,” Mr Henry said.
Chairman of the World Steel Association, Party Secretary and Chairman of HBIS Group, Yu Yong, commented: “The signing of the MOU fully demonstrates the two companies’ commitment to creating a green and low-carbon future across the value chain and a shared sense of responsibility to address climate change together, with a common vision to “contributing to a community of a shared future for mankind. This partnership ushers in a new chapter for the two companies to deepen our strategic cooperation and to achieve collaborative development.”
The MoU with HBIS Group follows recent partnerships established with major steelmakers China Baowu and JFE to explore emissions reduction from steelmaking.
BHP has been active in other areas to reduce emissions, including awarding the world’s first LNG-fuelled Newcastlemax bulk carrier tender and the first LNG supply agreement for those vessels, and renewable energy supply contracts for BHP’s Queensland coal mines and Nickel West operations.
