Andrew Forrest says Fortescue is in talks with China for 100 million tonnes of green iron supply

For Fortescue to sell 100 million tonnes a year of green iron to China, it must first work out a way to produce four million tonnes of green hydrogen each year.

Fortescue executive chairman Andrew Forrest at Beijing’s Tsinghua university.

Fortescue says it has begun negotiations with Chinese authorities for the supply of 100 million tonnes of green iron from its Pilbara operations, but has flagged the need for a huge amount of hydrogen to make the plan a reality.

Fortescue chairman Andrew Forrest flagged the plan in a presentation on Thursday to the Scottsdale Action Forum in Arizona, which is hosted by JPMorgan boss Jamie Dimon.

Dr Forrest’s presentation to the forum, hosted on the Fortescue website, did not give details of whether the negotiations were with China Mineral Resources Group (CMRG), established in 2022 as the country’s central iron ore buyer, or with another Chinese government agency.

In June 2023 Fortescue also announced an agreement with China’s Baowu steel group over the development of green iron technology, however.

The presentation did not put a time frame on the discussions, other than say they had begun in 2024.

Fortescue only ticked off on a $50m pilot plant for its green iron production plant at its Christmas Creek mine in late 2023, saying the plant would be producing 1500 tonnes of iron ore a year by 2025.

The company did not give an update on its progress in building the plant in its March quarter production report, delivered last week.

But Thursday’s presentation suggests Fortescue will need to produce enormous quantities of green hydrogen to make its vision come true, reiterating Dr Forrest’s previous ambition of producing 200 million tonnes a year of carbon-free iron ore for export to the company’s customers.

Fortescue has said its pilot plant will use renewable energy and green hydrogen reduction technology, together with an electric smelting furnace, to produce high grade iron for use in the steel industry.

Dr Forrest’s presentation suggests Fortescue will need about 8 million tonnes of hydrogen a year to reach its goal of producing 200 million tonnes a year of green iron, potentially eliminating 220 million tonnes a year of carbon emissions compared with current iron ore production.

Fortescue Energy boss Mark Hutchinson confirmed in February the company had held discussions with the BP-led Australian Renewable Energy Hub over potential power deals for the mining giant’s Pilbara iron ore operations, which could also have the capacity to supply energy for hydrogen production.

The AREH consortium – 48 per cent owned by fossil fuel giant BP, and with Macquarie, CWP Global and Intercontinental Energy as joint venture partners – plans to build a giant 26GW of combined solar and wind power on a 6500 square kilometre site north east of the Port Hedland iron ore export hub.

But Fortescue has otherwise outlined few options to build hydrogen production hubs close to its Pilbara iron ore operations.

The Scottsdale Action Forum is in its second year, and hosted more than 130 industry chief executives, directors, bankers and government officials, according to Fortescue.

Dr Forrest was the keynote “how to” speaker at the forum, Fortescue said on its website.

Originally published as Andrew Forrest says Fortescue is in talks with China for 100 million tonnes of green iron supply