Australia’s two largest iron ore miners and its biggest steelmaker have selected the Kwinana Industrial Area, south of Perth, as the location to develop Australia’s largest ironmaking electric smelting furnace (ESF) pilot plant. The groundbreaking project combines the expertise of BlueScope, BHP and Rio Tinto to test technology to enable the use of Pilbara iron ore to produce iron without the need for traditional blast furnaces, as the companies come together to try to accelerate the decarbonisation of steelmaking.

The industry leaders formed the NeoSmelt collaboration in February, combining BHP and Rio Tinto’s deep knowledge of Pilbara iron ore, with BlueScope’s unique operating experience in ESF technology. The NeoSmelt parties have also announced Woodside Energy will join the consortium as an equal equity participant and energy supplier, subject to finalising commercial arrangements.

The pilot plant aims to prove Pilbara iron ore can be used to produce lower-carbon emissions molten iron using direct reduced iron (DRI)-ESF technology. The pilot plant would produce 30,000 to 40,000 tonnes of molten iron a year. It will initially use natural gas to reduce iron ore to DRI; but once operational, the project aims to use lower-carbon emissions hydrogen to reduce iron ore.

If successful, NeoSmelt has the potential to open a pathway to near-zero emissions steelmaking using Pilbara iron ore and to ensure the longevity of Australia’s iron ore industry. Subject to funding, the project anticipates a decision to enter feasibility studies in Q2 2025 and is targeting final investment decision for the pilot plant in 2026, with operations expected to begin in 2028.