Australia, Canada, and Brazil, the major iron-ore producers, are likely to benefit from the looming shift towards green steel, according to Fitch Solutions head of commodities analysis Aurelia Britsch, who was speaking at the Hydrogen and Mines virtual summit on Wednesday.
A primary benefit would be that mining companies in these countries could claim lower Scope 3 emissions through the use of their ore in manufacture of low carbon steel at downstream customers.
Additionally, low carbon steel manufacture would change long-standing iron ore/steel supply chains.
Steel-makers in developed markets would see a revival of demand for their production as end-users would look for low carbon steel amid regulatory and climate controls on emissions. This would re-orient the flows of iron ore across the globe.
Furthermore, manufacturers of green steel would, in turn, prefer to source better quality and cleaner iron ore such as hydrogen-derived direct reduced iron-ore.
“This could present an opportunity for iron-ore majors with access to green hydrogen hubs, and lower cost hydrogen to increase iron-ore beneficiation and to produce green iron,” said the Fitch analyst.
As a corollary, “green hydrogen adoption in the mining sector has the most upside opportunities in China, the US, Australia and Canada, and to some extent, Chile, Russia and Poland,” she added.
Source: Mining Weekly
Images of Raglan Nickel Mine in Canada which uses a hydrogen energy storage unit and wind turbine (the only operational hydrogen project among mining players, as per Fitch): Natural Resources Canada