BlueScope Steel, an Australian steelmaker, has decided to collaborate with Shell to establish a renewable hydrogen hub at its 2.1 million tonnes per year Port Kembla steelworks in New South Wales’ Illawarra region (NSW).
The two companies will first look at establishing a 10MW pilot-scale renewable hydrogen electrolyser to test the usage of green hydrogen in BlueScope’s Port Kembla blast furnace. The hydrogen might also be used to fuel a pilot direct reduction iron (DRI) facility at Port Kembla, as part of BlueScope’s collaboration with Rio Tinto, a British-Australian mining company, to look at green steel production.
BlueScope and Shell will also attempt to partner with other organizations in the Illawarra region to build a hydrogen center. The NSW government has devised a $3 billion ($2.2 billion) investment plan to develop green hydrogen centers in the state’s Illawarra and Hunter Valley areas. Both regions are coal mining hubs, and Shell and BlueScope will explore into ways to provide local industrial and mining companies with both electricity and hydrogen.
“Any future potential hydrogen center in the Illawarra will require widespread support from governments, regulators, customers, and suppliers,” said Mark Vassella, CEO of BlueScope.
BlueScope has pledged to invest A$150 million over the next five years to reduce its greenhouse gas (GHG) emissions. However, it is proceeding with the A$700 million to A$800 million reline of its blast furnace in Port Kembla, implying a 20-year commitment to traditional steelmaking using iron ore and coking coal, albeit with minor modifications to reduce emissions.
It intends to replace PCI grade coking coal with gas from its coke ovens, which contain 60% hydrogen. It’s also working on a pilot hydrogen electrolyzer in Port Kembla with the federal government’s Commonwealth Scientific and Industrial Research Organisation (CSIRO) to complement coke oven gas.
BlueScope is also collaborating with the CSIRO to develop biochar, or charcoal made from the pyrolysis of organic waste, as an alternative for some of the metallurgical coal used in the blast furnace. This, along with expanded use of trash and renewable energy sources, is part of the company’s short-term aim to reduce carbon emissions.
BlueScope has set a target of being carbon-neutral by 2050. According to Vassella, it was unable to set the more ambitious aim of net-zero emissions by 2030 since the technology is not yet commercially viable.
