Australian iron ore producer Fortescue will more than double its decarbonisation investment over the July 2025-June 2026 financial year to $900mn-$1.2bn from $405mn in 2024-25, prioritising emissions reduction over mine development.
The company will continue to spend a similar amount of money on decarbonisation initiatives such as electrification over the next few years, it told investors on 26 August. The investments form part of its plan that it first announced in 2022, to spend $6.2bn on reaching ''real zero'' emissions between 2023-24 and 2028-29.
Fortescue's increased decarbonisation investments come alongside a decline in mine investment. It will spend $2bn-2.3bn on sustaining its mines and hub development in 2025-26, down from $2.6bn in 2024-25.
The company's exploration investment will remain relatively stable at $300mn-400mn in 2025-26, in line with the $324mn spent in 2024-25.
Fortescue will focus its decarbonisation investments on mine vehicle electrification projects and renewable energy projects. The company is currently building a 190MW solar farm at its Cloudbreak mine, which is 30pc complete, it said. The project should cut its diesel consumption by 125mn litres/yr, helping it reduce emissions.
Fortescue in June also applied for permission to build a 2.1GW wind farm and 220kV transmission line. The development would reduce the company's scope 1 and scope 2 greenhouse gas emissions by 1.5mn t/yr, it said. But the project is still at an early stage, with the company not having made a final investment decision, a spokesperson told Argus at the time.
Fortescue generated 2.64mn t of CO2 equivalent (CO2e) scope 1 emissions from direct operations in 2024-25, up by 12pc from 2.36mn t in 2023-24. The increase came from the partial ramp up of its 22mn wet metric tonne/yr Iron Bridge magnetite mine, which entirely offset electricity and battery-driven declines in emissions. The company expects to surrender Australian Carbon Credit Units (ACCUs) or Safeguard Management Credits (SMCs) worth 240,000t of CO2e for its 2024-25 emissions.
Fortescue's scope 1 emissions will likely rise again next year, before peaking in 2027-28, it said. The company's fleet electrification will drive the decline from 2027-28 onwards, it said.
