NeoSmelt, a consortium of major companies in the resources, energy, and manufacturing sectors, has announced support from the Australian Renewable Energy Agency (ARENA) for its pilot plant project in Western Australia. The initiative aims to develop lower-emissions steel from Pilbara iron ore.
The consortium was established by BlueScope, BHP, and Rio Tinto. It now includes two new equity participants: Woodside Energy and Mitsui Iron Ore Development. All five companies hold equal stakes in the joint venture.
Managed by BlueScope, NeoSmelt plans to build Australia’s largest ironmaking electric smelting furnace pilot plant at Kwinana Industrial Area near Perth. This facility will test methods to produce lower-carbon emissions molten iron using Western Australian iron ore.
ARENA has committed A$19.8 million for a Front-End Engineering Design study for the project. The study will explore if Pilbara iron ore can be used with a direct reduced iron-electric smelting furnace pathway to produce lower-carbon iron.
If successful, this could offer an alternative to traditional blast furnace steelmaking and support the longevity of Australia’s iron ore industry. The feasibility phase is underway, with a final investment decision expected in 2026.
Tania Archibald, BlueScope Chief Executive Australia, stated on behalf of the Joint Venture: “Today marks a significant step forward in developing a technology for lower-carbon emissions steelmaking using Pilbara ore.” She expressed appreciation for ARENA’s financial commitment and welcomed Woodside Energy and Mitsui Iron Ore Development as new partners.
Federal Resources Minister Madeleine King commented on Kwinana’s role in global decarbonization efforts: “Now Kwinana is playing a central role in the world’s energy transition.”
Western Australian Premier Roger Cook emphasized local manufacturing’s importance: “Local manufacturing is crucial to my Government’s plan for a future that is Made in WA.”
Operations at the NeoSmelt pilot plant are projected to begin in 2028 if approved. Initially using natural gas supplied by Woodside Energy, the project aims to eventually use hydrogen with lower carbon emissions.
The NeoSmelt pilot plant will test production methods using an electric smelting furnace capable of producing iron suitable for basic oxygen furnace steelmaking processes. Estimates suggest potential CO2 emission reductions of up to 80% compared with conventional blast furnaces when processing Pilbara iron ore through this method.
