Rio Tinto has signed a memorandum of understanding with German steelmaker SHS-Stahl-Holding-Saar GmbH & Co. KGaA and Luxembourg-based engineering firm Paul Wurth S.A. to explore production of low-carbon steel feedstock as part of its strategy to reduce carbon emissions.
The partnership will explore the viability of transforming iron ore pellets into low-carbon hot briquetted iron (HBI), a low-carbon steel feedstock, using green hydrogen generated from hydro-electricity in Canada.

Iron Ore Company of Canada (IOC), in which Rio Tinto holds a majority interest, will supply high-grade iron ores and expertise in mining, processing and pelletizing. Paul Wurth brings expertise in plant building and process knowledge in the field of highly efficient hydrogen generation and Midrex direct reduction plants. SHS brings deep iron and steel making expertise.

“Rio Tinto’s significant presence in the Canadian provinces of Quebec and Newfoundland and Labrador makes Canada a natural location for the project. Canada provides access to cost competitive hydro-electricity, and proximity to key markets in Europe and North America,” Rio Tinto said in a statement. “Transforming high-grade iron ore pellets into a low-carbon steel feedstock using green hydrogen, when processed in an electric arc furnace with carbon free electricity, has the potential to reduce significantly the carbon emissions associated with steelmaking.”

The parties will conduct a feasibility study into the potential development of industrial scale low-carbon iron production in Canada, utilizing the combined expertise of the three partners across the entire steel value chain. The feasibility study is scheduled for completion in late 2021, with an investment decision on a hydrogen based direct reduction plant at industrial scale expected to follow thereafter.

IOC president and chief executive officer Clayton Walker said: “This partnership is part of Rio Tinto’s climate strategy to pursue pro-active and action-oriented partnerships to support the development and deployment of low-carbon technologies for hard-to-abate processes like steelmaking.

“We are absolutely committed to being part of the solution on climate change and to support our customers and other stakeholders in the steel value chain as the industry transitions to a low-carbon future.”

Georges Rassel, CEO of Paul Wurth S.A, said: “This collaboration reflects Paul Wurth’s strategy to support our customers from the very beginning of their projects as a reliable and trusted partner. By associating the different players of the metal production chain, we are confident to develop the most appropriate and efficient solutions for this challenging transition toward a carbon neutral industry.”

Martin Baues, Member of the Board of Directors for Technology at SHS-Stahl-Holding Saar said: “Dillinger and Saarstahl adopted a future-focused strategy with the motto ‘proactive, carbon-free and efficient’. Within this strategy, we have defined various options for the transformation to carbon-neutral steel production. The use of hydrogen in steel production is a key factor in reducing carbon emissions. This partnership can further help us to reduce our carbon emissions on the basis of this technology, while gaining important experience in using hydrogen in steel production.”