Australia’s biggest iron ore miners and its largest steelmaker are joining forces to build the country’s biggest electric smelting furnace (ESF) pilot plant in Kwinana, south of Perth. BlueScope, BHP and Rio Tinto are testing new technology that strips carbon emissions from the steelmaking process using Pilbara iron ore rather than conventional blast furnaces.

This year, BHP, Rio Tinto, and BlueScope formed NeoSmelt, combining expertise in Pilbara iron ore and electric smelting furnace technology. The project aims to use DRI-ESF technology to produce lower-carbon molten iron, reducing the carbon footprint of steel production. Woodside Energy will also join the project as an equal equity participant and energy supplier, pending final commercial arrangements.

Also read: SAIL and BHP Partner to Explore Lower-Carbon Steelmaking Technologies

Pilot Plant Production and Decarbonization Goals

When operational, the pilot plant will churn out 30,000 to 40,000 tons of molten iron each year. It will use natural gas, to begin with, before a future switch to hydrogen. If successful, NeoSmelt could enable near-zero emissions steelmaking, ensuring Australia’s iron ore industry’s sustainability and meeting global demand.

The team chose the Kwinana Industrial Area for its strong logistics, infrastructure, and A$75 million support from the government. The plant’s location will establish Western Australia as a leader in the global effort to reduce emissions in steel production.

Western Australian Premier Roger Cook said, “Under my WA Labor Government, our State is becoming a global renewable energy powerhouse – creating the jobs of the future and setting up our economy for the long term.”

He added, “Putting the global steel industry on the pathway to near-zero emissions means more jobs in processing in WA, and a strong future for WA’s iron ore industry.”

Also read: BHP, Rio Tinto and Qantas to invest $52.7 million in Australian carbon credits fund

The NeoSmelt project is now moving into the next phase. Feasibility studies are expected to start in the second quarter of 2025. An FID will be taken by 2026, and the project is expected to start its operation by 2028. In addition, the project has been kept open for more partnerships with the same interests as those of the project.

Carbon recycling technology provider LanzaTech and steel and mining leader ArcelorMittal announced developments in their partnership to produce sustainable ethanol. Ethanol produced at ArcelorMittal’s Steelanol facility in Ghent, Belgium has reached a big volume. This volume is reported to be large enough to be efficiently transported by barge. This achievement follows the receival of Lanzatech’s first barge shipment of ethanol earlier during the month.

Also read: LanzaJet secures MUFG investment to scale sustainable aviation fuel technology 

Supply Chain for Sustainable Ethanol

LanzaTech is transporting the ethanol for purification and will sell it to CarbonSmart customers in the fragrance and home care industries. This development marks a key step in establishing a robust European supply chain for sustainably produced ethanol.

The Ghent Steelanol plant owned by ArcelorMittal has been producing 80 million litres per annum, which provides ethanol for half of the existing demands of Belgium. The company reduces 125,000 tons ayear in carbon emissions in its facility in Ghent.

Also read: Transition Industries and Mitsubishi Gas Chemical Partner for Sustainable Methanol

This project will contribute to supporting the EU’s 2030 Climate Target Plan: cutting greenhouse gas emissions by 55% by 2030. The project will partner with Primetals Technologies, ERM and receive support from CINEA, the European Climate, Infrastructure, and Environment Executive Agency.

LanzaTech’s carbon recycling technology, which powers the Steelanol facility, converts carbon-rich industrial emissions from ArcelorMittal’s blast furnace into high-quality ethanol. This innovative process helps create a circular economy by transforming industrial emissions into valuable products like fuel and consumer goods.

Dr. Jennifer Holmgren, Chair and CEO of LanzaTech said, “This production milestone represents an important step toward treating industrial emissions as raw materials—rather than waste—to profitably support European supply chains in the creation of everyday products,”

She added, “ArcelorMittal has long been a leader in decarbonizing the steel industry, and we look forward to building upon this achievement and expanding our operations together as we continue to advance a circular economy.”

The Steelanol facility started its ethanol production in 2023 offering various possibilities for the ethanol produced. These include, purification for consumer productions such as clothing, personal care items and packaging.