BlueScope will provide information on Canberra's planned Safeguard Reforms, which covers Australia's Emissions Intensive Trade Exposed (EITE) industries, this week before a February 24 deadline. The outcome of this consultation could impact the viability of Port Kembla's existing operations and a planned A$1 billion blast furnace reline.
BlueScope was ranked 13th in Australia for greenhouse gas (GHG) emissions as of 30 June 2021 after electricity and gas companies, and aluminum and iron ore producer Rio Tinto. The company spent A$120 million on initial blast furnace relining work up to 30 June 2022, but did not provide an update on the progress of its half-year financial results, released on 20 February 2023. Blast Furnace No. 6 is scheduled to be relined. Replace No. 5 when it reaches the end of its service life in 2026 to continue conventional steel production beyond 2040.
Pending safety reforms to reduce emissions BlueScope by 5 percent every year until 2030. According to BlueScope CEO Mark Vassella, there is no commercially proven technology yet to do this. This could result in Australian steel production being shut down and replaced with steel imports from less regulated regions.
BlueScope worked with Rio Tinto to use hydrogen to produce low-carbon direct reduced iron (DRI) at Port Kembla , but did not make the desired progress on the electrolyser project to produce hydrogen. “We are considering whether this model is right for us going forward,” Vassella told analysts on Feb. 20.
BlueScope is seeking alternative investors for its planned 10MW pilot smelter after Shell withdrew from the project in August . Vassella believes commercial steel production using hydrogen instead of coking coal is still decades away, and Blast Furnace No. 6 needs to be relined to fill the gap. The firm has a net zero target for 2050.
BlueScope, which operates steel manufacturing and marketing operations in Australia, the US, New Zealand and Asia, reported a profit of A$599 million for the half year to 31 December 2022, down 64% from a year earlier, mainly due to reduction in the price of steel compared to iron. ores and coking coal, lower volumes and higher costs.
