NeoSmelt has received A$19.8m from the Australian Renewable Energy Agency (ARENA) to support the front-end engineering design (FEED) study for its pilot plant in Western Australia (WA).
The project aims to develop Australia’s largest ironmaking electric smelting furnace to demonstrate a method for producing molten iron with reduced carbon emissions.
NeoSmelt is a joint venture (JV) dedicated to producing lower-emission steel from Pilbara iron ore. Managed by BlueScope, it comprises founders BlueScope, BHP and Rio Tinto, and two new equity participants: Woodside Energy and Mitsui Iron Ore Development. All five participants holding equal equity stakes.
The JV announced Kwinana Industrial Area as the location for the project in December last year.
BlueScope Australia CEO Tania Archibald, on behalf of the JV, said: “Today marks a significant step forward in developing a technology for lower-carbon emissions steelmaking using Pilbara ore, and we are delighted by ARENA’s A$19.8m commitment to support the feasibility phase of this groundbreaking R&D [research and development] pilot plant.
“With this backing from government and industry leaders, we now have the opportunity to develop world-leading technology that will have potential application across the global steel industry and provides the foundation for a future Australian lower-carbon emissions iron export industry.”
The ARENA funding complements a A$75m contribution from the WA Government announced last year.
The feasibility study for the project is currently ongoing and will inform a final investment decision expected in 2026.
The pilot plant, expected to begin operations in 2028, is projected to produce between 30,000 and 40,000 tonnes of molten iron annually.
Initially, the plant will use natural gas supplied by Woodside Energy to reduce iron ore to direct reduced iron. The long-term goal is to utilise lower-carbon emissions hydrogen for this process.
If successful, the NeoSmelt project could offer a sustainable alternative to traditional blast furnace steelmaking, potentially ensuring the longevity of Australia’s iron ore industry.
