Santos has signed a memorandum of understanding (MoU) with Liberty Primary Metals Australia Pty Ltd (part of GFG Alliance), one of South Australia’s biggest commercial industrial gas users, to enter into discussions for gas supply combined with carbon capture and storage (CCS) opportunities to support the green steel transformation of the Whyalla steelworks.
Santos Managing Director and CEO Kevin Gallagher said the MoU to supply abated natural gas is aimed at assisting the GFG Alliance in its decarbonisation pathway as it transitions to a Direct Reduction Plant (DRP) in Whyalla that can process local magnetite ore to produce low-carbon iron. The DRP will initially use a mix of natural gas and green hydrogen as the reducing agent, to fully transition to green hydrogen as it becomes available at scale.
The MoU includes a joint pre-feasibility study of CCS opportunities aimed at abating emissions from the Whyalla iron and steel works.
This could see GFG Alliance become the first domestic third-party customer for Santos’ flagship carbon capture and storage project at Moomba.
Gallagher applauded the GFG Alliance for its green steel ambitions and said that natural gas combined with CCS could provide an accelerated, affordable decarbonisation pathway while green hydrogen is being developed at scale.
“We’ve been a gas supplier to Whyalla for many years and we’re pleased to be working with GFG on its green steel journey [and] we’re seeing strong interest in abated natural gas domestically and internationally.
“This MoU is great news for the Upper Spencer Gulf and South Australia because industries such as the Whyalla steel works rely on affordable energy combined with decarbonisation to grow into the future – keeping jobs, skills and business opportunities here in the region to support vibrant local communities for decades to come.”
Santos’s $210 million Moomba CCS Project will be one of the biggest in the world and will safely and permanently store 1.7 million tonnes of carbon dioxide per year in the same reservoirs that held oil and gas in place for tens of millions of years.
GFG Alliance Executive Chairman Sanjeev Gupta said” “I am very pleased to be working with a strong partner in Santos on natural gas supply for our operations, necessary for the transition to hydrogen. Furthermore, we are happy to support and applaud the pursuit of Santos’s carbon capture and storage ambitions which could play a significant role in reducing residual emissions from our steelworks.”
Liberty Primary Steel and Mining CEO Sandip Biswas said: “Whyalla has all the elements required to lead the green steel industry in one location — vast reserves of high-quality magnetite, the abundant potential for the generation of renewable energy, a cape-sized capable seaport, a skilled workforce, extensive existing infrastructure, a supportive community, collaborative governments and now a secured pathway to offtake natural gas and decarbonisation collaboration.”
