Energy Efficiency, GHG Emissions, Industrial - September 22, 2022
Fortescue to Spend $6.2 Billion for Decarbonisation
Fortescue Metals Group Ltd aims to eliminate fossil fuel use and achieve real zero terrestrial emissions (Scope 1 and 2) across its iron ore operations by 2030.
The US$6.2 billion investment, largely planned in FY24-28, will eliminate Fortescue’s fossil fuel risk profile and enable it to supply its customers with a carbon-free product.
This investment includes the deployment of an additional 2-3 GW of renewable energy generation and battery storage and the estimated incremental costs associated with a green mining fleet and locomotives. The capital expenditure to purchase the fleet will be aligned with the scheduled asset replacement life cycle and included in Fortescue’s sustaining capital expenditure. Studies are underway to optimize the localized wind and solar resources.
Fortescue expects to generate attractive economic returns from its investment arising from the operating cost savings due to the elimination of diesel, natural gas, and carbon offset purchases from its supply chain. The company will eliminate 3 million tons of CO2 equivalent emissions per annum and establish a significant new green growth opportunity by producing a carbon free iron ore product and through the commercialization of decarbonization technologies
“We are already seeing direct benefits of the transition away from fossil fuels - we avoided 78m litres of diesel usage at our Chichester Hub in FY22 - but we must accelerate our transition to the post fossil fuel era, driving global scale industrial change as climate change continues to worsen,” said Fortescue Executive Chairman Dr Andrew Forrest AO in a statement. "Fortescue, FFI and FMG, is moving at speed to transition into a global green metals, minerals, energy and technology Company, capable of delivering not just green iron ore but also the minerals, knowledge and technology critical to the energy transition.