Representatives of Sasol and ArcelorMittal on Tuesday signed a deal to investigate the feasibility of developing carbon capture technologies to produce sustainable fuels, as well as “green steel” production.

The signing took place in Cape Town on the first day of the Africa Energy Week conference, a four-day event bringing together African energy leaders, ministers, global investors and executives from across the public and private sectors.

Representatives of Sasol and Arcelor Mittal sign the agreement at Africa Energy Week to the applause of  Minerals and Energy Minister Gwede Mantashe (third from right) and Western Cape Premier Alan Winde (second from left). (Photo: Ethan van Diemen)

In a statement released shortly after the announcement, Sasol explained that “​​under a joint development agreement, they will advance studies into two potential projects: the Saldanha green hydrogen and derivatives study which will explore the region’s potential as an export hub for green hydrogen and derivatives, as well as green steel production; and the Vaal carbon capture and utilisation (CCU) study to use renewable electricity and green hydrogen to convert captured carbon from ArcelorMittal South Africa’s Vanderbijlpark’s steel plant into sustainable fuels and chemicals”. 

Sasol also signed a Memorandum of Understanding with Freeport Saldanha Industrial Development Zone to develop a “globally competitive green hydrogen hub and ecosystem” within Saldanha Bay.

Read more in Daily Maverick: “Green hydrogen — how South Africa can capitalise on it, and why we need to do it fast”

Dr Emanuele Taibi, head of the Power Sector Transformation Strategies, International Renewable Energy Agency, told the World Economic Forum that “hydrogen is the simplest and smallest element in the periodic table. No matter how it is produced, it ends up with the same carbon-free molecule”.

Taibi continued that “green hydrogen is defined as hydrogen produced by splitting water into hydrogen and oxygen using renewable electricity”, adding that “green hydrogen is an important piece of the energy transition” and that it can be used to “decarbonise sectors that are difficult to electrify — like heavy industry, shipping and aviation”.

In a report compiled by global information consultancy IHS Markit, titled “The Super H2igh Road Scenario for South Africa”, a “feasible scenario” is laid out that the country could cut its greenhouse gas emissions by 75% by 2050 if it were to take advantage of the opportunities presented by the hydrogen economy.

In its statement, Sasol noted that “both initiatives have the potential for ArcelorMittal South Africa to be the first African green flat steel producer using green hydrogen to produce direct reduced iron (DRI) via the Midrex facility at its Saldanha Works (which is presently under care and maintenance), while also reducing the carbon footprint of its flagship Vanderbijlpark Works”.

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To best understand what green steel is, one needs to understand how steel is currently produced. The International Energy Agency explains that around 75% of steel is still largely made in coal-fired blast furnaces, which pump large amounts of carbon dioxide into the atmosphere. Huge amounts of energy are also needed to heat the furnaces to above 1,000°C. Overall, steel production accounts for about 8% of global emissions.

When these coal-fired blast furnaces are replaced with ones that run on carbon emission-free green hydrogen, the steel that is produced is accordingly considered green steel.

Further to the north of the country, the partnership will look into the feasibility of carbon capture and use (CCU) in the Vaal. 

“The Vaal CCU study will explore using up to 1.5 million tonnes a year of unavoidable industrial CO2 captured from the ArcelorMittal South Africa’s Vanderbijlpark Works. The CO2 is envisaged to be transported to the Sasolburg and Ekandustria operating facilities in Sasolburg and, together with green hydrogen, will eventually replace natural gas as a feedstock to produce sustainable chemical products,” Sasol explains in its statement.

Read more in Daily Maverick: “Green hydrogen provides answer to many of South Africa’s decarbonisation prayers, studies show”

Priscillah Mabelane, executive vice president for Sasol’s Energy Business, said at the conference that “we intend to play a key leading role in developing and maximising the region’s green hydrogen opportunities. 

“As part of that, we intend to revitalise different industries, to utilise our mineral resources, such as the platinum group metals to be able to stimulate technology developments, but at the same time, ensure that some industries, such as the steel industry — that has lost competitiveness in the past — can be repositioned to compete on the global stage.

“We see partnerships as a crucial enablement in accelerating the development of the southern African green hydrogen economy,” said Mabelane. OBP/DM