The Australian independent company Santos will supply about 20 PJ/year (534 million m3/year) to the Whyalla steelworks steelworks in accordance with a 10-year agreement signed with the government of the State of South Australia (SA).
The total volume of gas supplies in the amount of 200 PJ will amount to 1.2 million tons./On February 20, Santos announced that the steel mill in Whyalla will switch to low-emission pig iron production, subject to the signing of a gas supply agreement by June 30. Deliveries will begin on March 1, 2030.
The supply is carried out from the Moomba plant at indexed prices and with a prepayment structure, the deal will coincide with the expiration of the Santos Horizon contract with the Gladstone LNG joint venture for the supply of 7.8 million tons of LNG per year, which began in 2016.
Santos gas will allow Whyalla to implement direct iron reduction technology for processing magnetite ore into low-carbon iron, Chief Executive Kevin Gallagher said on February 20, which will reduce emissions by about 50% compared to previous coal-fired blast furnaces.
On February 19, 2025, administrative control was introduced at the steel mill after the South Korean government passed laws to deprive the British company GFG Alliance of control of the plant. Australian steel producer BlueScope is leading a consortium hoping to acquire the plant, while aid in the form of subsidies of more than 2.5 billion Australian dollars ($1.76 billion) is aimed at bringing the plant to a low cost.the Emission control Center.
Whyalla, an Adelaide-based company, reported that 20 PJ/year will consume about 30% of the current gas production in the Cooper Basin in Santos.
The Labor government of Southern California previously planned to build a clean hydrogen sector based on Whyalla, but last year[url=https://direct.argusmedia.com/newsandanalysis/article/2684362]abandoned plans to build a 250 MW electrolyzer and a 200 MW hydrogen-powered power plant, and instead This was redirected unspent funds to save the steel mill.
The Australian Climate Energy Finance think tank was skeptical about the gas-fired steel industry. The production strategy is supported by the federal and state governments due to uncompetitive domestic gas prices in Australia, the report said.
