- GMTN Portal /
- Identische Inhalte (Aktueller Treeview) /
- Media & News /
- News /
- Business News /
- Australia’s mine operators place their bets on “green” iron for converter steel
Australia’s mine operators place their bets on “green” iron for converter steel
Key technology for green iron using Australian fine ore: Electric smelting furnace (ESF) for sponge iron (DRI).
Image: Hatch
Australia is the world’s largest supplier of iron ore, but the raw material from Down Under is not suitable for low-carbon electrical steel production. That is set to change. Australian mine operators, steel producers and technology companies are working flat-out on green iron production using Australian fine ore. The promise is climate-friendly steel production without blast furnaces, even as regards the currently dominant process using the basic oxygen furnace – which, looking at countries such as China and India, is a market worth billions.
With renewable energy and hydrogen, steel production from iron ore using direct reduction (DR) and electric arc furnaces (EAF) can be virtually climate-neutral, but the process is subject to one crucial limitation: the DR-quality iron ore required for the EAF is in short supply. According to estimates by Wood Mackenzie, a market research company specialising in energy and raw materials, only around 3% of iron ore shipments transported by sea meet the necessary quality requirements. The scarcity and high cost of this DR-suitable raw material has limited commercial production of direct reduced iron (DRI), sponge iron, to a handful of locations in the Middle East, North Africa, the USA, India and Russia. Those are locations that have suitable ore reserves and/or natural gas (or steam coal) available at particularly favourable prices.
Most CO2 emissions from steel production are generated during pig iron production via the blast furnace route, the predominant process with a share of around 70% of global production. Therefore, due to its widespread use and the relatively new blast furnace fleets in the major steel regions China and India, reducing emissions in the blast furnace process will be an essential part of the roadmap to decarbonisation, as the Australian mining group BHP states.
Australia is the world’s largest exporter of iron ore. The Pilbara region is home to some of the largest iron ore mines in the world, accounting for more than 50% of global production, and Pilbara iron ore is the number one feedstock in the blast furnaces of the leading steelmaking nations. For the direct reduction route using EAF, however, Australia’s gangue-rich fine ore is out of the question, for quality reasons. On the other hand, Australia has one of the highest levels of solar radiation of all the countries in the world and is therefore well suited to utilising solar energy for “green” steel production, even though renewable energies currently only play a relatively minor role in local electricity generation.
Direct reduction using hydrogen plus electric smelting furnace with renewable energy
BHP, like other mine operators in the Pilbara region of Australia, are aware of the challenges of decarbonisation and are striving to convert their iron ore production to CO2-free technologies while maintaining the proven basic oxygen furnace (BOF) process. Their endeavours include investments in the development of the direct reduction and electric smelting furnace process (DRI-ESF).
The electric smelting furnace (ESF) produces liquid pig iron from the higher-grade Pilbara ore, which is suitable for the steel production process in the basic oxygen furnace (BOF). Initially, the iron ore is converted into direct reduced iron (DRI), which is melted down in the ESF, and slag is separated. The ESF yields two major advantages for steel producers. For one, the DRI – ESF – BOF route can be used for low-grade iron ore in particular, as it copes well with the slag that is produced. For another, the BOF can remain in place when the ESF is implemented. Steel manufacturers with integrated plants do not have to change the downstream units in their production chain or renew certifications when they invest in an ESF: while the electric smelting furnace is being installed, the blast furnace can remain in operation until the ESF is ready for use.
Neosmelt under the direction of Bluescope
The Neosmelt joint venture, led by steel producer BlueScope and involving ore suppliers Rio Tinto and BHP, is planning to build Australia’s largest pilot plant for the production of low-carbon iron using an electric smelting furnace (ESF) south of Perth. The project has recently received further government funding and is on the home straight. The main focus is on building a direct reduction plant and an electric smelting furnace, with the prospect of using hydrogen and renewable energy. According to Neosmelt, estimates show that processing Pilbara iron ore in a DRI-ESF process can reduce CO2 emission intensity by up to 80% compared to the current industry average for conventional blast furnace steel production.
DRI technology by Tenova – electric smelting furnace from Hatch
The project began in the second quarter of 2025 with feasibility studies and orders placed with plant manufacturers Hatch and Tenova. The final investment decision for the pilot plant is due in 2026 and, if the decision is positive, operations are expected to start in 2028 to produce 30,000 to 40,000 tonnes of molten iron per year. With Woodside as the preferred energy supplier, the pilot plant would initially use natural gas to reduce iron ore to DRI. After commissioning, the project is to be converted to the use of lower-carbon hydrogen for the reduction of iron ore and the ESF is anticipated to run on renewable energy.
US company Hatch is responsible for project management and steering of the pilot feasibility study. Within this framework, Hatch will also be responsible for the technological layout of the ESF, which is based on Hatch’s electric smelting furnace technology (Crisp+). Hatch is one of the leading suppliers of electric smelting furnaces for the primary production of copper, nickel, and ferrous alloys and, with its patented Continuous Reduced Iron Steelmaking Process (Crisp) technology, also for iron.
Neosmelt has commissioned Italian plant manufacturer Tenova to carry out the front-end engineering design (FEED) for the direct reduction plant. The DRI plant will use the Energiron DRI technology jointly developed by Tenova and Danieli and is designed for annual production of up to 50,000 tonnes of DRI, during which process both natural gas and hydrogen can be used as reducing agents.
Sustainable biomass and microwave energy instead of coal
The Australian mining companies have no intention of leaving it at that. BHP, for example, is pursuing a number of projects alongside Neosmelt and has invested in electrolysis-based technologies in addition to processes for the direct reduction of iron. RioTinto, for its part, is pursuing another technology alongside Neosmelt with its BioIron project, which uses raw, sustainable biomass and microwave energy instead of coal to convert Pilbara ores into iron. According to RioTinto, in combination with rapidly growing biomass and renewable energies, BioIron has the potential to reduce CO2 emissions by up to 95% compared to the current blast furnace process.
Green Metal Project – 1,500 tonnes of iron per year
In the heart of the Pilbara region in Western Australia, the Australian mining company Fortescue is pressing ahead with its Green Metal Project, which plans to produce more than 1,500 tonnes of green iron per year. The plant will use green hydrogen to produce DRI from Pilbara fine ore in a reduction furnace. That will be further processed into “green” iron in an electric smelting furnace. The green hydrogen is produced right next door in the electrolysis plant for gaseous and liquid hydrogen – the largest of its kind in Australia, Fortescue says. According to Fortescue, both the hydrogen plant and the ESF are partly operated during the day with more than 160,000 solar modules. The plant is to be running entirely on renewable energies by 2030. The company expects to start production this year.
This is not the end of the story. At its innovation centre in Perth, Fortescue is working on an energy-saving process for direct electrochemical reduction, which enables the conversion of Pilbara iron ore into environmentally friendly ferrous metal even without hydrogen. The technology developed on a pilot scale is an iron ore electrolyser, which uses intermittent renewable energy to produce raw green iron for steel production. Fortescue is working with Deakin University and Curtin University to realise the project. Fortescue has developed a technology for iron ore electrolysers in which iron ore is electrochemically reduced to ferrous metal at the cathode and oxygen is produced as a by-product at the anode. Being in its early stages, the technology is at a very low level of efficiency and still requires considerable research and development work to bring the idea to market maturity.
Zesty – new direct reduction technology for green iron
With its Zesty technology (Zero Emissions Steel Technology), Australian company Calix intends to take a completely new approach to DRI production using Pilbara iron ore. The technology company, founded in 2005, originally developed an indirect heating process for the cement industry with the aim of separating the medium to be heated from the heat source. Special steel pipes are heated from the outside using electricity and renewable energy sources and alternative or conventional fuels. Ground minerals float down through the tubes, where they are quickly heated by the heat radiated by the tube walls. According to the company, the indirect heating process enables clean, efficient and precise electric heating that replaces carbon-intensive fossil fuels and inefficient combustion. Carbon dioxide, which is unavoidably produced during the manufacture of cement and lime, for example, remains pure and is released directly from the raw material. According to Calix, this allows it to be efficiently collected and utilised or stored.
Zero Emissions Steel Technology is an extension of Calix’s so-called CFC core technology, in which fine iron ore (typically < 500 μm) is fed in from the top of the reactor and hydrogen from the bottom in a counterflow arrangement. The iron ore is quickly heated and reduced to sponge iron (DRI). The DRI can then be further processed into hot briquetted iron (HBI) or melted in a smelting plant (ESF) to separate the gangue from the iron, which is then exported to steel manufacturers and/or integrated into downstream steelmaking processes.
As a first step, Calix intends to build a demonstration plant with a capacity of 30,000 tonnes per year for hydrogen-reduced iron (H2-DRI) or transportable hot briquetted iron (HBI). The demonstration project is currently starting with the detailed design. According to Calix, a final investment decision in favour of building the demonstration plant, the location of which has not yet been announced, is planned for the 2026 financial year. According to Calix, the electric heating is compatible with intermittent operation, which means that the process can be heated using renewable energy sources. One of the strengths of indirect electric heating is that hydrogen is only used as a reducing agent and not as a fuel. The Zesty process targets the theoretical minimum hydrogen consumption (54 kg/t H-DRI for a haematite ore) with a recycling loop to return the unreacted hydrogen to the process, which the company says results in significantly lower hydrogen usage than comparable DRI technologies. According to the Superpower Institute’s report “A Green Iron Plan for Australia”, the targeted benefits of Zesty could provide significant cost savings for green iron projects compared to “inflexible” direct iron reduction technologies using hydrogen.
Source: Proprietary research
With renewable energy and hydrogen, steel production from iron ore using direct reduction (DR) and electric arc furnaces (EAF) can be virtually climate-neutral, but the process is subject to one crucial limitation: the DR-quality iron ore required for the EAF is in short supply. According to estimates by Wood Mackenzie, a market research company specialising in energy and raw materials, only around 3% of iron ore shipments transported by sea meet the necessary quality requirements. The scarcity and high cost of this DR-suitable raw material has limited commercial production of direct reduced iron (DRI), sponge iron, to a handful of locations in the Middle East, North Africa, the USA, India and Russia. Those are locations that have suitable ore reserves and/or natural gas (or steam coal) available at particularly favourable prices.
Most CO2 emissions from steel production are generated during pig iron production via the blast furnace route, the predominant process with a share of around 70% of global production. Therefore, due to its widespread use and the relatively new blast furnace fleets in the major steel regions China and India, reducing emissions in the blast furnace process will be an essential part of the roadmap to decarbonisation, as the Australian mining group BHP states.
Australia is the world’s largest exporter of iron ore. The Pilbara region is home to some of the largest iron ore mines in the world, accounting for more than 50% of global production, and Pilbara iron ore is the number one feedstock in the blast furnaces of the leading steelmaking nations. For the direct reduction route using EAF, however, Australia’s gangue-rich fine ore is out of the question, for quality reasons. On the other hand, Australia has one of the highest levels of solar radiation of all the countries in the world and is therefore well suited to utilising solar energy for “green” steel production, even though renewable energies currently only play a relatively minor role in local electricity generation.
Direct reduction using hydrogen plus electric smelting furnace with renewable energy
BHP, like other mine operators in the Pilbara region of Australia, are aware of the challenges of decarbonisation and are striving to convert their iron ore production to CO2-free technologies while maintaining the proven basic oxygen furnace (BOF) process. Their endeavours include investments in the development of the direct reduction and electric smelting furnace process (DRI-ESF).
The electric smelting furnace (ESF) produces liquid pig iron from the higher-grade Pilbara ore, which is suitable for the steel production process in the basic oxygen furnace (BOF). Initially, the iron ore is converted into direct reduced iron (DRI), which is melted down in the ESF, and slag is separated. The ESF yields two major advantages for steel producers. For one, the DRI – ESF – BOF route can be used for low-grade iron ore in particular, as it copes well with the slag that is produced. For another, the BOF can remain in place when the ESF is implemented. Steel manufacturers with integrated plants do not have to change the downstream units in their production chain or renew certifications when they invest in an ESF: while the electric smelting furnace is being installed, the blast furnace can remain in operation until the ESF is ready for use.
Neosmelt under the direction of Bluescope
The Neosmelt joint venture, led by steel producer BlueScope and involving ore suppliers Rio Tinto and BHP, is planning to build Australia’s largest pilot plant for the production of low-carbon iron using an electric smelting furnace (ESF) south of Perth. The project has recently received further government funding and is on the home straight. The main focus is on building a direct reduction plant and an electric smelting furnace, with the prospect of using hydrogen and renewable energy. According to Neosmelt, estimates show that processing Pilbara iron ore in a DRI-ESF process can reduce CO2 emission intensity by up to 80% compared to the current industry average for conventional blast furnace steel production.
DRI technology by Tenova – electric smelting furnace from Hatch
The project began in the second quarter of 2025 with feasibility studies and orders placed with plant manufacturers Hatch and Tenova. The final investment decision for the pilot plant is due in 2026 and, if the decision is positive, operations are expected to start in 2028 to produce 30,000 to 40,000 tonnes of molten iron per year. With Woodside as the preferred energy supplier, the pilot plant would initially use natural gas to reduce iron ore to DRI. After commissioning, the project is to be converted to the use of lower-carbon hydrogen for the reduction of iron ore and the ESF is anticipated to run on renewable energy.
US company Hatch is responsible for project management and steering of the pilot feasibility study. Within this framework, Hatch will also be responsible for the technological layout of the ESF, which is based on Hatch’s electric smelting furnace technology (Crisp+). Hatch is one of the leading suppliers of electric smelting furnaces for the primary production of copper, nickel, and ferrous alloys and, with its patented Continuous Reduced Iron Steelmaking Process (Crisp) technology, also for iron.
Neosmelt has commissioned Italian plant manufacturer Tenova to carry out the front-end engineering design (FEED) for the direct reduction plant. The DRI plant will use the Energiron DRI technology jointly developed by Tenova and Danieli and is designed for annual production of up to 50,000 tonnes of DRI, during which process both natural gas and hydrogen can be used as reducing agents.
Sustainable biomass and microwave energy instead of coal
The Australian mining companies have no intention of leaving it at that. BHP, for example, is pursuing a number of projects alongside Neosmelt and has invested in electrolysis-based technologies in addition to processes for the direct reduction of iron. RioTinto, for its part, is pursuing another technology alongside Neosmelt with its BioIron project, which uses raw, sustainable biomass and microwave energy instead of coal to convert Pilbara ores into iron. According to RioTinto, in combination with rapidly growing biomass and renewable energies, BioIron has the potential to reduce CO2 emissions by up to 95% compared to the current blast furnace process.
Green Metal Project – 1,500 tonnes of iron per year
In the heart of the Pilbara region in Western Australia, the Australian mining company Fortescue is pressing ahead with its Green Metal Project, which plans to produce more than 1,500 tonnes of green iron per year. The plant will use green hydrogen to produce DRI from Pilbara fine ore in a reduction furnace. That will be further processed into “green” iron in an electric smelting furnace. The green hydrogen is produced right next door in the electrolysis plant for gaseous and liquid hydrogen – the largest of its kind in Australia, Fortescue says. According to Fortescue, both the hydrogen plant and the ESF are partly operated during the day with more than 160,000 solar modules. The plant is to be running entirely on renewable energies by 2030. The company expects to start production this year.
This is not the end of the story. At its innovation centre in Perth, Fortescue is working on an energy-saving process for direct electrochemical reduction, which enables the conversion of Pilbara iron ore into environmentally friendly ferrous metal even without hydrogen. The technology developed on a pilot scale is an iron ore electrolyser, which uses intermittent renewable energy to produce raw green iron for steel production. Fortescue is working with Deakin University and Curtin University to realise the project. Fortescue has developed a technology for iron ore electrolysers in which iron ore is electrochemically reduced to ferrous metal at the cathode and oxygen is produced as a by-product at the anode. Being in its early stages, the technology is at a very low level of efficiency and still requires considerable research and development work to bring the idea to market maturity.
Zesty – new direct reduction technology for green iron
With its Zesty technology (Zero Emissions Steel Technology), Australian company Calix intends to take a completely new approach to DRI production using Pilbara iron ore. The technology company, founded in 2005, originally developed an indirect heating process for the cement industry with the aim of separating the medium to be heated from the heat source. Special steel pipes are heated from the outside using electricity and renewable energy sources and alternative or conventional fuels. Ground minerals float down through the tubes, where they are quickly heated by the heat radiated by the tube walls. According to the company, the indirect heating process enables clean, efficient and precise electric heating that replaces carbon-intensive fossil fuels and inefficient combustion. Carbon dioxide, which is unavoidably produced during the manufacture of cement and lime, for example, remains pure and is released directly from the raw material. According to Calix, this allows it to be efficiently collected and utilised or stored.
Zero Emissions Steel Technology is an extension of Calix’s so-called CFC core technology, in which fine iron ore (typically < 500 μm) is fed in from the top of the reactor and hydrogen from the bottom in a counterflow arrangement. The iron ore is quickly heated and reduced to sponge iron (DRI). The DRI can then be further processed into hot briquetted iron (HBI) or melted in a smelting plant (ESF) to separate the gangue from the iron, which is then exported to steel manufacturers and/or integrated into downstream steelmaking processes.
As a first step, Calix intends to build a demonstration plant with a capacity of 30,000 tonnes per year for hydrogen-reduced iron (H2-DRI) or transportable hot briquetted iron (HBI). The demonstration project is currently starting with the detailed design. According to Calix, a final investment decision in favour of building the demonstration plant, the location of which has not yet been announced, is planned for the 2026 financial year. According to Calix, the electric heating is compatible with intermittent operation, which means that the process can be heated using renewable energy sources. One of the strengths of indirect electric heating is that hydrogen is only used as a reducing agent and not as a fuel. The Zesty process targets the theoretical minimum hydrogen consumption (54 kg/t H-DRI for a haematite ore) with a recycling loop to return the unreacted hydrogen to the process, which the company says results in significantly lower hydrogen usage than comparable DRI technologies. According to the Superpower Institute’s report “A Green Iron Plan for Australia”, the targeted benefits of Zesty could provide significant cost savings for green iron projects compared to “inflexible” direct iron reduction technologies using hydrogen.
Source: Proprietary research