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Mining Giant Fortescue Plans to Convert Bulkers to Run on Ammonia

fmg
Image courtesy FMG

Published Oct 6, 2021 8:15 PM by The Maritime Executive

As part of an ambitious plan to decarbonize its full product lifecycle, Australian mining firm Fortescue Metals Group (FMG) is planning to convert its eight supersized bulkers to run on green ammonia. 

On Tuesday, Fortescue announced that it is aiming to achieve net-zero Scope 3 emissions by 2040, making it the first major mining company to announce a specific target for this category. Scope 3 carbon comes from third-party activities that are indirectly impacted by a firm's value chain; in the case of an iron-ore producer like Fortescue, Scope 3 accounts for the vast majority of the lifecycle emissions of the product, because the firm's entire output is sold to highly carbon-intensive steelmakers.

While its customers' operations may be outside of its direct control, Fortescue has an ambitious plan to give them the tools they need to decarbonize. Through its Fortescue Future Industries division, it plans to develop its own mass-scale green hydrogen production plants; use that hydrogen to make iron out of its own ore; and sell the resulting "green iron" to its customers for their use in making steel. 

Since Fortescue expects to be making plenty of green hydrogen, green ammonia is a logical choice for FMG to power its own marine operations. As part of its Scope 3 plan, it wants to convert its fleet to ammonia power and support the adoption of green ammonia in new vessel construction. As a practical matter, it is already doing its own in-house testing of ammonia as a marine fuel and pursuing class approval for an ammonia-powered ore carrier design.

"Fortescue has commenced its transition from a pure play iron ore producer to a green renewables and resources company, underpinned by the world’s first major carbon emission heavy industry operation to set a target to achieve carbon neutrality by 2030," said Fortescue CEO Elizabeth Gaines. "We remain committed to actively engaging with our customers, suppliers and other key industry participants to facilitate the reduction of emissions. This includes the development of technologies and the supply of green hydrogen and ammonia through FFI, which will provide significant opportunities for the steel, cement and land and sea transport industries to decarbonize."

Fortescue has already announced plans to decarbonize its own mine sites and other core operations (Scope 1 and 2) by 2030.