Wood Mackenzie has identified Hawsons Iron’s namesake project and Fortescue’s Iron Bridge project as two of Australia’s most important iron ore projects.
In its September report, ‘Pedal to the metal’, which contemplates iron and steel’s $US1.4 trillion shot at decarbonisation, WoodMac said Iron Bridge and Hawsons Iron would be critical if Australia is able to “compete in a 1.5°C world”.
WoodMac’s 1.5°C accelerated energy transition scenario (AET-1.5) is a scenario in which global temperatures since pre-industrial times are limited to 1.5°C by the end of this century and the world reaches net-zero by 2050.
Without projects like Hawsons Iron coming online, Australia and the world risks not having access to the resources needed to drive down emissions in steel manufacturing.
Hawsons Iron has been developing its namesake project with the aim of producing a 70 per cent iron (Fe) product when operations are up and running. This is poised to be one of the highest-grade Fe products on the seaborne market.
For context, BHP’s Western Australian Iron Ore (WAIO) operations have historically produced iron ore at 61 per cent Fe. This will increase to 62 per cent once BHP’s South Flank operation has ramped up.
Hawsons Iron elaborated on its Hawsons Supergrade product and what it means for steelmakers in its 2022 annual report.
“While magnetite, compared to hematite, is generally of a lower grade in the ground, the Hawsons orebody has a valuable differentiating characteristic: its relative softness,” Hawsons said in the report.
“Our orebody is contained within a softer siltstone rather than a hard, glass-like silica rock known as ‘chert’ that is common to the magnetite orebodies in the Pilbara region of Western Australia.
“This softness offers commercial advantages, requiring less energy during crushing and grinding to process the ore into pellets and concentrates.
“A higher grade can be achieved because the ore breaks cleanly around the grain boundaries, easily separating from impurities and waste.”
So how does this benefit steelmakers?
Hawsons Iron said that while steel is a critical ingredient to the manufacturing of cars and construction products, it accounts for around 7 per cent of the world’s annual CO2 emissions.
“About 70 per cent of steel is produced using coal in oxygen blast furnaces,” Hawsons said. “These furnaces create emissions during the iron-making process when fed iron ore, coke and minerals used to remove impurities.
“Making one tonne of steel this way requires about 770kg of coking coal; and for every tonne of steel produced, almost two tonnes of carbon dioxide is created.”
Hawsons Iron said that in order to reduce steel’s carbon footprint, steelmakers are expected to transition from traditional blast furnaces to green hydrogen-based direct reduced iron (DRI) processes.
“DRI technology requires a feedstock of high-grade, low-impurity iron ore like Hawsons Supergrade to produce low-to-zero-emission green steel,” the company said.
Wood McKenzie noted in ‘Pedal to the metal’ that portfolio diversification towards high-grade ore mines, the divestment of polluting and low-grade mines, and investments in beneficiation and floatation will be at the heart of miners’ strategy to stay relevant.