The two companies will probe different ventures in China and Australia.
Anglo-Australian mining giant Rio Tinto and China Baowu, the world’s largest steel producer will explore multiple projects in China and Australia together that will help decarbonize the steel value chain, according to a joint press release. The two companies signed a memorandum of understanding (MoU) to probe several initiatives which include the expansion of the development of China Baowu’s Hydrogen-enriched carbon cycle and oxygen (HyCROF) technology which can reduce CO2 emissions from the blast furnace process.
Further projects are the research and construction of an electric melter at one of Baowu’s steel mills in China and a possible low-carbon iron plant in Western Australia.
Rio Tinto and China Baowu share a 50-year-long history of collaborations. The new MoU aligns the Anglo-Australian company’s goals of decarbonizing its iron ore sector with “China’s commitment to curbing emissions and promoting high-quality green development,” Rio Tinto’s Chief Commercial Officer Alf Barrios said. According to the consulting firm McKinsey, steel production accounted for eight percent of global CO2 emissions in 2018. Rio Tinto unveiled its strategy to decarbonize its steel sector last month, emphasizing the role clean hydrogen could play here.
The rising importance of clean hydrogen for the steel industry is also driving Rio Tinto’s and China Baowu’s competitors to explore related projects. Swedish state-owned mining company LKAB and Norwegian company Blastr plan to construct climate-friendly steel factories in Sweden and Finland, respectively. In the production of clean hydrogen elements from the platinum metals group (PMG) are often used as catalysts in the electrolysis of water because of their chemical abilities. Rising demands for clean hydrogen could have implications for the required raw materials.