Mine owner blasts 'obsolete' Port Kembla technology, pushes green steel

As BlueScope was receiving $137 million from the Federal Government to help pay for the reline of the No.6 blast furnace at Port Kembla, Mr Gupta's Liberty Steel received $63 million from Canberra.

The funding, announced by Climate Change and Energy Minister Chris Bowen in Port Kembla on Wednesday, was revealed by the Mercury on Tuesday night.

But while BlueScope will invest the money in traditional high-emission steelmaking technology in the form of its blast furnace, Mr Gupta is using the funds to build an electric arc furnace at Liberty's plant at Whyalla in South Australia.

The electric arc furnace would replace Liberty's blast furnace, starting the transition to new, cleaner steelmaking.

Mr Gupta did not mince his words for traditional steelmaking methods.

"Now is the time to phase out increasingly obsolete equipment and technology that no longer has a place in our world and embrace the installation of new Electric Arc Furnace technology that ensures environmentally sustainable steel production in Whyalla will continue throughout the 21st century," he said.

BlueScope has consistently said that greener steelmaking technology was not yet commercially feasible, and that the blast furnace reline was a "bridge to the future".

Liberty Steel clearly believes it can be viable and is investing in this future now.

"Whyalla will be the global epicentre for manufacturing low carbon iron and steel, it has all the elements required to dominate the green steel industry - vast reserves of magnetite of the highest quality, abundant generation of renewable energy, deep sea port, a robust workforce, supportive governments and invested owners," Mr Gupta said.

BlueScope's billion-dollar blast furnace reline will make small reductions in greenhouse gas emissions due to upgraded equipment and better efficiency.

This would help BlueScope to meet the emission reduction target of 1 per cent, itself a discount on the 4 per cent reduction the nation's heaviest emitters must reach, under the Government's Safeguard Mechanism targets.

This softer target was given to BlueScope and other manufacturers in hard-to-abate and trade-exposed industries after negotiations over the safeguard legislation.

Its blast furnace plan had been criticised at home and internationally for locking in high-emissions steelmaking for at least 20 years.

Mr Bowen said green steel was "not here yet" but was "coming".

BlueScope declined to comment on Mr Gupta's broadside, leaving Wednesday's comments from its head of Australian Steel Products Tania Archibald to do the talking.

"Given the current state of technology, the multi-year lead time to reline the blast furnace and the absence of key enablers for DRI, such as abundant low cost natural gas or green hydrogen, BlueScope made the decision in 2023 that the most prudent way to proceed is to reline the No. 6 blast furnace," Ms Archibald said.

She said BlueScope would have more to say on its decarbonisation plans in the near future.

"We're doing a lot of work around lower emissions iron and steelmaking, particularly what's going on in Europe," Ms Archibald said.

"We have a lot of technical partnerships already in place, a lot of work around DRI options and we'll have more to say about that in the very near future."

- with reporting by Connor Pearce