Shell, BlueScope work on Australian hydrogen hub

Australia-based steel producer BlueScope Steel has agreed to work with Shell to develop a renewable hydrogen hub at its 2.1mn t/yr Port Kembla steelworks in the Illawarra region of New South Wales (NSW).

The two firms will initially investigate building a 10MW pilot-scale renewable hydrogen electrolyser to allow them to test the use of green hydrogen in BlueScope's blast furnace at Port Kembla. The hydrogen could also be used to feed a pilot direct reduced iron (DRI) plant at Port Kembla, as part of BlueScope's tie-up with UK-Australian mining firm Rio Tinto to investigate green steel production.

BlueScope and Shell will also look to collaborate with other organisations to develop a hydrogen hub in the Illawarra region. The NSW government has created an A$3bn ($2.2bn) state-funded investment plan to develop green hydrogen hubs in the Illawarra and Hunter Valley regions of the state. Both regions are coal mining centers and Shell and BlueScope will look at options to supply both electricity and hydrogen to local manufacturing and mining industries.

"Any future potential hydrogen hub in the Illawarra will need broad support from governments, regulators, customers and suppliers," BlueScope chief executive Mark Vassella said.

BlueScope has committed to invest A$150mn into reducing its greenhouse gas (GHG) emissions over the next five years. But it is also moving forward with the A$700mn-800mn reline of its blast furnace at Port Kembla, which implies a 20-year commitment to traditional steelmaking using iron ore and coking coal, albeit with some tweaks to minimise emissions.

It plans to initially replace pulverised coal injection (PCI) grade coking coal with gas from its coke ovens, which contain 60pc hydrogen. It has also teamed up with the federal government's Commonwealth Scientific and Industrial Research Organisation (CSIRO) to work on the pilot hydrogen electrolyser at Port Kembla to supplement coke oven gas.

BlueScope is also partnering with CSIRO to use charcoal produced from the pyrolysis of organic material, or biochar, as another replacement for a portion of the metallurgical coal used in the blast furnace. This, combined with the increased use of scrap and renewable power sources, is part of the firm's plan to begin reducing its carbon emissions in the short term.

BlueScope has set a goal of net-zero GHG emissions by 2050. It was unable to set the more ambitious target of net-zero emissions by 2030 because the technology to do so is not yet commercially viable, according to Vassella.

By Jo Clarke