Fortescue aims for net zero Scope 3 emissions by 2040

Fortescue plans to address emissions across its entire global value chain
Fortescue aims for net zero Scope 3 emissions by 2040 Fortescue aims for net zero Scope 3 emissions by 2040 Fortescue aims for net zero Scope 3 emissions by 2040 Fortescue aims for net zero Scope 3 emissions by 2040 Fortescue aims for net zero Scope 3 emissions by 2040

Shipping is an area of emissions focus

Australia-based iron ore mining company Fortescue Metals Group has announced its new target to achieve net zero Scope 3 emissions by 2040.

Scope 3 emissions are emissions generated due to activities from assets not owned or controlled by the company, but that it indirectly impacts in its value chain; for example, by suppliers, third-party transportation services and the processing and use of its products.

Fortescue plans to address emissions across its entire global value chain, including crude steel manufacturing which accounts for 98% of its Scope 3 emissions. Green hydrogen supplied by Fortescue Future Industries (FFI) is the key enabler of the company's plans.

The company's approach to reducing Scope 3 emissions is to develop projects and technologies that focus on reducing emissions from iron and steel making. It also plans to work with current and prospective customers on the application of the technology as well as the supply of green hydrogen and ammonia from FFI.

Fortescue will also prioritise the decarbonisation of its own fleet of eight ore carriers as well as engaging with shipping partners to reduce, and hopefully eliminate, emissions from shipping.

FFI is targeting the production of 15Mt/y of green hydrogen by 2030. Fortescue said that this will underpin opportunities to work on emissions reduction and elimination projects with customers and shipping partners.

As well as the long-term goal to achieve net zero Scope 3 emissions by 2040, Fortescue has set some medium-term targets. One of these goals is reduction of 50% in emissions intensity levels from the shipping of Fortescue's ores by 2030 when compared to levels in the 2021 fiscal year. Another goal is the reduction of 7.5% in emissions intensity levels from steel making by Fortescue's customers by 2030 compared to 2021 fiscal year levels, to 100% by 2040.

Elizabeth Gaines, CEO of Fortescue Metals Group, said: "Climate change is the most pressing issue of our generation and at Fortescue, setting stretch targets is at the core of our culture and Values and we are proud to set this goal to tackle emissions across our value chain.

"Fortescue has commenced its transition from a pure play iron ore producer to a green renewables and resources company, underpinned by the world's first major carbon emission heavy industry operation to set a target to achieve carbon neutrality by 2030. This Scope 3 target is consistent with this transition and complements our targets for Scope 1 and 2 emissions reduction.

"Collaboration is integral to driving the rapid transition to green energy, and we remain committed to actively engaging with our customers, suppliers and other key industry participants to facilitate the reduction of emissions. This includes the development of technologies and the supply of green hydrogen and ammonia through FFI, which will provide significant opportunities for the steel, cement and land and sea transport industries to decarbonise."

To achieve the target, Fortescue and FFI are focused on accelerating several key initiatives. Fortescue's existing maritime vessels, including its fleet of ore carriers, will be converted to being fuelled by green ammonia, and the company will support the adoption of green ammonia in new vessel construction.

Fortescue and FFI will also pursue opportunities to reduce and eliminate emissions in iron and steel making, which will be facilitated using renewable energy and green hydrogen.

Finally, they will undertake research and development work to produce green iron and cement from Fortescue ores at low temperatures without coal.

Julie Shuttleworth, CEO of FFI, said: "Our investments in technologies and research and development are focused on demonstrating that the production of iron ore, cement, iron and steel can operate with renewable energy.

"Our work to decarbonise Fortescue's iron ore operations will position Fortescue as the first major supplier of green iron ore in the world, paving the way for production of green iron and a new green steel industry."