• Fortescue Metals Group chairman urged action to deliver zero carbon energy projects in Australia
  • Appoints former PM Malcolm Turnbull and former diplomat Nick Warner to key roles in green energy team
  • Several ASX companies including Fortescue, Australian Vanadium and Iron Road are pursuing green iron ore projects


Andrew Forrest’s grand call in a televised speech a few weeks ago for Australia to produce green steel made from zero-emissions energy such as hydrogen is starting to lead to action.

In his speech ‘Oil versus water: Confessions of a carbon emitter’ broadcast on ABC television for its Boyer Lecture series in January, Forrest said the answer to curbing Australia’s greenhouse gas emissions was not to stop mining iron ore, but to produce iron ore and steel using zero emissions energy.

“The green hydrogen market could generate revenues — at the very least — of $US12 trillion by 2050. Bigger than any industry we have,” a transcript of his speech said.

The Fortescue Metals Group (ASX:FMG) chairman said Tuesday he had appointed two Australian heavyweights to his company’s Australian Fortescue Future Industries (AFFI) group.

The company has been established to identify renewable energy and green hydrogen projects for development both in Australia and globally using Fortescue’s demonstrated expertise in adopting innovative technology.

Fortescue Metals Group has a stated policy target of achieving net zero carbon emissions from its operations by 2040, effectively decarbonising its iron ore production.


PM Turnbull brings renewable energy expertise

Former Prime Minister Malcolm Turnbull will become chairman of the special group, and former diplomat Nick Warner a special adviser for international affairs, effective immediately.

“Mr Warner’s expertise on global intelligence is incomparable, and his knowledge will be critical as we continue to engage foreign governments to explore green hydrogen opportunities,” Forrest said.

“I am proud to announce that former Australian prime minister Malcolm Turnbull will join the AFFI board of directors as chairman,” he added.

Turnbull will bring vital experience and familiarity with issues such as environmental conservation and energy crises to the work of the AFFI.

The former prime minister between 2015 and 2018 promoted renewable energy and started construction of the Snowy hydroelectric scheme, the largest renewable project in the Southern Hemisphere.

AFFI is a wholly-owned subsidiary of Fortescue Metals Group and the business will have an international scope in terms of its operations.

Warner served as the director-general of the Office of National Intelligence, director-general of the Australian Secret Intelligence Service, and as Defence Department secretary.

In these posts he had a leading role in Australian activities in Afghanistan, Iraq, and Iran where he also served as Australian ambassador and as a high commissioner in PNG.


Green hydrogen projects for steel

Fortescue Metals Group announced in November a study to build a green ammonia plant in Tasmania’s Bell Bay, a location for aluminium smelting.

The company’s vision is for a 250MW plant to produce 250,000 tonnes per year of green hydrogen for domestic use and international export.

An investment decision on the plan is expected sometime in 2021.

Other green hydrogen projects being studied by the company include a refuelling facility for passenger vehicles at its Christmas Creek iron ore mine in WA.

The iron ore company has also signed a memorandum of understanding with Hyundai Motor Company and the CSIRO to advance hydrogen technology for domestic transport.

Australian think tank The Gratton Institute said in a report last year that Australia’s abundant renewable energy sources are well suited to making hydrogen for steel production.

“And Australia’s lower cost green hydrogen will make it a better place to produce green steel than places like Japan or Indonesia,” said the institute’s report.

The think tank suggests Australia could gain a 7 per cent share of the world market for producing green steel that would require around $200bn of investment.

“The amount of investment is large, but is much less than the $350 billion invested in Australia by the oil and gas industry in the past decade alone,” The Gratton Institute said.

Industrialist Sanjeev Gupta and his GFG Alliance group of companies plan to produce green steel in a modern facility at the Whyalla steelworks in South Australia.

The facility will initially run on natural gas, and later hydrogen with a zero carbon emissions footprint.


ASX companies investing in green hydrogen projects

ASX company Iron Road (ASX:IRD) has a project for green hydrogen to produce iron ore pellets at a new production facility at South Australia’s Cape Hardy port.

The project could serve as a prototype for green hydrogen projects in Australia’s iron ore sector as it hopefully moves from the drawing board and into reality over the next few years.

Hydrogen Utility (H2U), a developer of green hydrogen projects in Australia, is a partner in the project, as is Japanese engineering and technology company Mitsubishi Heavy Industries.

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

Meanwhile, Australian Vanadium (ASX:AVL) is seeking to use green hydrogen produced from renewable energy sources to reduce emissions at its eponymous project in WA.

As vanadium ore is extracted from the project it is subject to a process called a reductive roast – roasting it in the absence of oxygen – to create a pig iron product.

“When you use hydrogen, you could bring the material back towards pig iron and as you do that you can add a massive amount of value,” managing director, Vincent Algar, said.


Technical issues that need to be solved

There are some technical issues around hydrogen in terms of its storage that need to be addressed first before its large-scale use as a fuel for industry and for transportation.

One of these issues is hydrogen embrittlement where the gas can diffuse through metals like steel and cause them to become brittle and prone to breaking, cracking or damage.

Some experts suggest that a lot of technical work needs to be done to solve this issue, and also in developing a commercially-available hydrogen-based engine for transportation.


ASX share prices for Australian Vanadium (ASX:AVL), Fortescue Metals Group (ASX:FMG), Iron Road (ASX:IRD)