Gupta, Santos sign deal on Whyalla green steel

Sanjeev Gupta wants to establish a state-of-the-art green iron and steel plant in South Australia powered by renewable energy and green hydrogen.

GFG Alliance head Sanjeev Gupta in Whyalla, South Australia. Picture: AAP

Sanjeev Gupta’s GFG Alliance will explore supplying clean hydrogen from its South Australian electrolyser factory for the production of green steel under a pact with the state government while Santos will supply gas and carbon capture technology for the Whyalla site.

The Whyalla steelworks in January received $63.2m under the federal government’s Powering the Regions Fund to help pay for its switch from coal-based steelmaking to using electricity, with an electric arc furnace to replace the coal-fired blast furnace.

GFG has an ambition to transition to carbon-neutral steelmaking globally by 2030, and in April last year announced it would invest up to $500m in the furnace and eventually a hydrogen-fulled direct reduction plant at Whyalla.

Mr Gupta said the agreement with the state government and Santos had underlined its commitment to produce 4 billion ­tonnes of high-quality magnetite and establish a state-of-the-art green iron and steel plant powered by renewable energy and green hydrogen.

GFG Alliance also on Sunday signed a memorandum of understanding with Santos for a long-term gas supply deal to Whyalla and a pact to consider using Santos’s Moomba carbon capture and storage plant to cut emissions from the facility. If the carbon capture deal proceeds, it would see GFG become the first domestic third-party customer for the Moomba plant.

Santos said the Whyalla plant would initially use a mix of natural gas and green hydrogen as the reducing agent, with the aim of fully transitioning to green hydrogen as it becomes available at scale.

“We are happy to support and applaud the pursuit of Santos’s carbon capture and storage ambitions which could play a significant role in reducing residual emissions from our steelworks,” Mr Gupta added.

The first stage of Santos’s Moomba CCS project, which will inject carbon dioxide into depleted underground oil and gas reservoirs for permanent storage, is about 80 per cent complete and will come online in mid-2024.