Fortescue’s Carbon Neutrality Strategy Leading The World To Green Steel Production

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Fortescue’s Carbon Neutrality Strategy Leading The World To Green Steel Production

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  • FFI is Fortescue’s carbon neutrality strategy for 2030
  • Green hydrogen supplied by FFI to de-carbonise the steelmaking, power generation and long-range sea transport industries globally
  • Gladstone to become the centrepiece for FFI’s manufacturing capability of renewable energy equipment
  • Fortescue rapidly becoming an integrated renewable energy participant globally

Fortescue Future Industries (‘FFI’)

FFI is leading Fortescue’s decarbonisation strategy, by developing a global portfolio of renewable energy and green hydrogen projects. The strategy seeks to use 100 percent renewable energy to produce green electricity, green hydrogen, green ammonia and other green industrial products, to de-carbonise the steel, power generation and transport industries. This strategy is in support of Fortescue’s stated intention to achieve carbon neutrality in its own operations by 2030 and in its customers’ operations by 2040.

FFI is Fortescue’s green energy enabler and has announced the construction of the world’s largest electrolyser, renewable industry and equipment manufacturing centre at Gladstone, Queensland. The Global Green Energy Manufacturing centre (‘GEM‘) will manufacture equipment essential for the generation of renewable energy and green hydrogen. The GEM will manufacture wind turbines, solar photovoltaic cells, electrolysers, as well as long-range electric cabling.    

An electrolyser is a piece of equipment that is used to produce hydrogen, from water, using a process known as electrolysis. Electrolysis is the process where an electric current is passed through water, decomposing water into oxygen and hydrogen gas. By using electricity generated from a renewable source, the hydrogen produced has a zero-carbon footprint.

Green hydrogen and its fuel derivatives can be used as an energy source for steelmaking, long-range shipping and power generation. Significantly, these are some of the world’s most carbon-intensive industries.    

Construction of GEM is scheduled to commence in February 2022 and electrolysers are scheduled to come off the production line from early 2023. These are for both domestic use and for export.

As green hydrogen production is scaled-up, it will be a major contributor to achieving net zero carbon emissions globally by 2050. This positions FFI to potentially become the world’s leading fully renewable energy and green products producer.

Fortescue is no longer a pure play iron ore producer. It is rapidly progressing to become an integrated player in the renewables and green resources sector on a global scale.

This isn’t just positive for the environment, its also positive for Fortescue shareholders.

Caroline Wong

Caroline Wong is a Research Analyst at KOSEC – Kodari Securities. She writes on markets and focuses on ASX Top 300 companies. Email Caroline at c.wong@kosec.com.au.

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