The Pilbara is at risk of becoming a ‘wasteland'. Could green iron help?
Australia's vast Pilbara iron ore industry has the potential to reinvent itself into a lucrative 'green iron' export powerhouse, research suggests, amid warnings that China's hunt for higher-quality ore to make cleaner steel may hasten the mining province's demise.
Andrew Forrest, the billionaire chairman of Western Australia's third-largest iron ore shipper, Fortescue Metals Group, declared last week that Chinese steel mills' shift away from traditional blast furnaces to less-polluting technologies threatened to turn the iron ore mining hub into a 'wasteland'.
'They're looking straight into a future that may or may not include WA,' Forrest told a mining summit in Perth.
Iron ore – the raw material needed to manufacture steel – is Australia's biggest export commodity, raking in more than $100 billion in export revenue a year, and China is the world's biggest importer.
But as Australia's iron ore giants face difficulties maintaining the quality of their supplies, there are fears demand could shrink as Chinese steel mills turn to less-emitting processes that use electricity instead of coal and require higher grades of iron ore with fewer impurities.
Rod Sims, the long-serving former chair of the Australian Competition and Consumer Commission, said China's effort to clean up its polluting steel industry posed a threat but also a potentially enormous opportunity for Australia, which he said was 'superbly well positioned' to pivot to green iron manufacturing.
'Green iron is the next great chapter in Australia's export story,' Sims said. 'As the world decarbonises, our fossil fuel exports will inevitably decline – but by using our unparalleled renewable energy resources to make green iron, we can replace those exports with high value, zero carbon products that the world will need.'
One way to produce green iron involves the use of green hydrogen – hydrogen produced using renewable energy to split water into hydrogen and oxygen – as a substitute for coal in the steel-making process to ensure the end product is emissions-free.
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