Abstract
Climate change has quickly become the focal point of both challenges and opportunities for today’s iron and steel industry. Novel lower-emission processes and flowsheets are being developed and implemented at a record pace and traditional project constraints are being fundamentally re-examined. Due to this, the entire iron and steel value chain is undergoing a disruptive shift – and iron ore is at the centre of this transformation. While most of the decarbonization pressure falls upon the steel producers today, iron ore producers will be heavily affected by the motivations and decisions of their clients. This presents an excellent opportunity for iron ore producers to facilitate meaningful decarbonization of the iron and steel value chain.
A first principle, value-in-use approach to the entire value chain is needed to navigate this dynamic landscape for iron ore producers and steelmakers alike. Key factors which must be considered in the development of new iron ore projects and strategy decisions for existing operations include: the evolving ironmaking and steelmaking processes; the profitability of iron- and steelmaking operations when selecting process routes and raw material; the maturing GHG regulations and accounting principles; synergies with other value chains (such as hydrogen, renewables, and biomass); the transfer and implication of Scope 3 GHG emissions along the value chain by each stakeholder; and most importantly, the complex interaction between all aforementioned variables.
To illustrate the proposed approach, several archetypal case studies are used to emphasize how proposed iron ore projects can be influenced and optimized by different downstream processes and strategies. The proposed modeling technique also demonstrates how quantitative results can be generated to guide final investment decisions and long term strategies.