Fortescue Metals Group (FMG) and South Korean steelmaker Posco have agreed to a partnership that will see the FMG supply Posco with iron ore and green hydrogen.
At a meeting in Seoul on December 14th, 2020, Posco CEO Jeong-Woo Choi and FMG Chairman Andrew ‘Twiggy’ Forrest discussed the potential of a cooperative green hydrogen business.
FMG has already set a carbon neutrality target of 2040. But, what is more, Forrest and his executives have been jet setting around the world in recent months securing deals, such as this one with Posco, in the pursuance of its ambitious plans to build one of the biggest renewable energy portfolios in the world, delivering more than 235 GW of renewable capacity (that is five times the current capacity of Australia’s National Energy Market).
“FMG is a long-term contract supplier that has been stably supplying iron ore to Posco,” said Choi. “If competitive green hydrogen can be produced with cooperation between the two companies and is introduced to Korea, the era of green hydrogen in Korea will be accelerated.”
Part of the deal will see FMG use Posco’s premium steel materials, PosMAC, for all the solar and wind generation behind the green hydrogen FMG produces. As it stands then, Posco will import FMG’s iron ore to make the steel. The steel will then be supplied back to FMG’s solar developments to generate green hydrogen in Western Australia (WA).
Posco has set itself a carbon neutrality goal of 2050, a target which the company is establishing a green hydrogen business to tackle.
“Green hydrogen and ammonia are important factors in reducing carbon emissions as the world is in the transition to clean energy,” said Forrest. “I hope that with Posco’s participation in the first green hydrogen project conducted by FMG, both companies can grow together.”
Twiggy’s green energy journey
The partnership with Posco is one of many deals ‘Twiggy’ Forrest and his executives have secured in recent months. Forrest himself has been putting serious miles on the engine of the FMG private jet in a world tour to set the stage for the company’s renewable energy business, Fortescue Future Industries (FFI).
According to the Sydney Morning Herald, Forrest returned to WA last week after “his four-month mystery world tour.” After undertaking a “formal supervised 14-day quarantine period in New South Wales” Forrest received an exemption from the WA Government to return to the state without an additional quarantine.
At the FMG Annual General Meeting (AGM) in November, it was revealed that Forrest intended to visit up to 47 countries on his search for renewable energy projects and mineral resources for FFI.
Although much of the adventure has been kept secret, it is known that Forrest began his journey in Papua New Guinea and Indonesia where national leaders signed non-binding agreements with FFI for multi-billion dollar renewable projects. Next stop, Afghanistan, then onto Japan where Kawasaki Heavy Industries and Iwatani Corporation signed an MOU with FFI to investigate the potential for a liquid hydrogen supply-chain. Presumably, Forrest’s next stop was to meet with Choi and Posco in Seoul.
It is also believed Forrest or his executives have been on scouting missions throughout Europe, the US, Ecuador, Colombia, Brazil, the Congo, Kenya and Ethiopia.
FMG’s share price has more than doubled in the last year, making it Australia’s fourth-biggest listed company. Of course, much of this surge has to do with the rising iron ore price during the Covid-19 pandemic, but it is clear that Forrest himself is not sitting back and enjoying his mining billions. The magnate is on a mission to transform his empire into a global green force.
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