BHP Billiton and POSCO of South Korea have signed a Memorandum of Understanding (MoU) to collaboratively investigate greenhouse gas emission reduction solutions in integrated steelmaking.
The parties agree to conduct pilot and plant trials to reduce carbon in the steelmaking process, including improving coke quality and evaluating carbon capture, storage, and utilization (CCUS) methods to reduce carbon intensity in the blast furnace, as part of the MoU.
POSCO and BHP also plan to exchange research on hydrogen-based direct reduction technology, biomass in steelmaking, and the ability to utilise BHP’s carbon offsetting capabilities to generate carbon-neutral steel products.
Under the terms of the MoU, BHP plans to invest up to $10 million over the following five years, with the option to enhance investment in technologies under the trial. BHP’s contribution will come from its $400 million Climate Investment Program, which was announced in 2019 to fund projects, partnerships, and research and development aimed at lowering Scope 1, 2, and 3 emissions.
BHP and POSCO also plan to collaborate on carbon emissions reporting throughout the steel value chain in order to advance global standards that are consistent, transparent, and rigorous.
“The path to net zero for steelmaking is not yet clear,” BHP Chief Commercial Officer Vandita Pant said, “but we believe that by working together with industry leaders like POSCO, we will identify solutions more swiftly to help cut carbon emissions in steelmaking and along the value chain.” BHP has declared a goal of achieving net zero Scope 3 emissions by 2050, and we’re dedicated to collaborating with steelmakers to solve this difficult-to-abate sector.
“Steel is a crucial product for the world’s growth and decarbonization, and we must work together to enable greener steel by reducing carbon intensity in the blast furnace and experimenting with innovative steel-making technology.”
“Though achieving carbon neutrality is a difficult path ahead, with POSCO working together with BHP’s outstanding mining expertise and the will to achieve a low-carbon future, I have every reason to believe that we can create a significant turning point in carbon emission reduction across our value chain,” said Hag-Dong Kim, POSCO’s Head of Steel Business Unit.
The agreement with POSCO builds on BHP’s previous collaborations with major steelmakers China Baowu, JFE Steel, and HBIS Group to investigate ways to reduce emissions from the steelmaking process. The four steel corporations’ combined output accounts for about 12% of total global steel production.
