Generation Steel has signed a non-exclusive agreement with Rio Tinto (ASX:RIO) to purchase direct reduced iron (DRI) processed in Western Australia using Calix’s (ASX:CXL) Zesty™ DRI technology.
Subject to approvals and a final investment decision, Rio will supply Generation Steel with DRI produced from Pilbara iron ore and processed at Calix’s Zesty green iron demonstration plant in the Kwinana-Rockingham area.
The demonstration facility, located within the Western Trade Coast State Development Area near Kwinana, targets an annual production capacity of up to 30,000 tonnes of DRI. It is backed by grant funding from the Australian Renewable Energy Agency (ARENA) and a non-exclusive joint development agreement with Rio.
Calix’s Zesty™ technology combines electric heating and hydrogen reduction to convert iron ore into low-carbon-intensity DRI, replacing traditional coal-based ironmaking.
Generation Steel co-founder Don Johnston says the Collie steel mill is “Australia’s first steel mill investment in a generation”.
“We planned the mill to be fed only by local recycled scrap steel, which all currently goes offshore,” Johnston shares.
“To support the future of green iron in Australia and make green steel products from Pilbara iron ore is a fantastic additional opportunity.”
He adds that the Collie steel mill will use modern electric arc furnace technology to monitor and test the Zesty DRI through to finished steel.
The arrangement allows Generation Steel to source DRI from other providers while supporting broader efforts to test downstream pathways for Zesty-produced DRI closer to end-use markets.
Supply remains contingent on the development and successful commissioning of the demonstration plant.
Generation Steel is developing the $850-million Collie steel mill in WA to process 100% Australian recycled scrap steel into 450,000 tonnes a year of reinforcing bar, wire rod, and merchant bar.
Write to Paula Fabe at Mining.com.au
Main image: Generation Steel
