Anglo American said on Tuesday that it had signed a memorandum of understanding with H2 Green Steel “to work together on the advancement of low carbon steelmaking processes”.

“The agreement includes studying and trialling the use of premium quality iron ore products from Anglo American’s Kumba mines in South Africa and Minas-Rio mine in Brazil as feedstock for H2 Green Steel’s direct reduced iron production process at its Boden plant in Sweden,” it said.

The main destination for Kumba’s iron ore is China, but some of it will now head to the land of Abba for research and development (R&D).

“Our work with H2 Green Steel will focus on exploring ways for premium, responsibly produced iron ore from our operations to be used as feedstock in the Boden plant’s low carbon production process, paving the way to a cleaner, greener way to produce steel,” said Peter Whitcutt, head of Anglo’s marketing business.

The initiative is part of Anglo’s decarbonisation journey. Anglo American aims to reduce its Scope 3 emissions – those indirectly linked to its value chain through assets it does not own – by 50% by 2040. The company’s target is to reach “operational carbon neutrality” by the same year.

Green steel would play a significant role on that front for Anglo as well as more widely for global efforts to curb greenhouse gas emissions from fossil fuel usage.

Green steel is made without fossil fuels. According to the World Economic Forum, steel production accounts for about 8% of global emissions – the biggest carbon footprint among heavy industries. Most is still produced from coal-fired blast furnaces.

One aim is to replace coal with hydrogen generated by renewable energy. Demand for steel is not likely to ebb anytime soon, given its crucial role in modern infrastructure and urbanisation.

This Anglo initiative is one of many in the green steel space.

Sasol and ArcelorMittal last year signed a deal to investigate the feasibility of developing carbon capture technologies to produce sustainable fuels, as well as green steel production.

Read more in Daily Maverick: Sasol and ArcelorMittal sign deal to look into feasibility of carbon capture and ‘green steel’

So the scramble for green steel is on and it is being driven by science, which the likes of Anglo and Sasol are pretty good at. The iron grip of fossil fuels on the global economy is rapidly loosening. DM/BM