British-Australian multinational iron ore company Rio Tinto has signed a long-term agreement with Swedish green steel producing company H2 Green Steel to supply a significant portion of iron ore pellets for their flagship plant in Boden, Sweden, which will be one of the world’s first large-scale producers of low-carbon iron and steel.
H2 Green Steel’s plant is scheduled for operation in 2025, when it will process direct reduction pellets into hot briquetted iron (HBI) and then make steel through electric arc furnaces using green hydrogen.
The Boden site will hold one of the world’s largest electrolysis plants for green hydrogen production.
Under the agreement, Rio Tinto will also purchase and sell a portion of the plant’s excess low-carbon HBI while growing its steelmaking capacity.
The production of steel, a key material for infrastructure and the net zero energy transition, currently contributes around 8% of global carbon emissions.
Carbon dioxide emissions can be reduced by up to 95% by using green hydrogen in electric arc furnaces instead of traditional steelmaking, in which coal is used in a blast furnace.
‘We are partnering across the steel ecosystem to find better ways to support the decarbonization of iron and steel making, and to reduce our scope 3 emissions,’ Rio Tinto Head of Steel Decarbonization Simon Farry was quoted as saying in the statement.
‘Our supply of high-grade iron ore pellets will support the acceleration of H2 Green Steel’s project, and on-selling their low-carbon HBI will enable us to gain a deeper understanding of the future needs of our customers and end users in the emerging green iron and steel market,’ he added.
