ASX200 Miners Collaborate on Greener Steelmaking with $19.8M Boost from ARENA

June 17, 2025 01:41 PM AEST | By Team Kalkine Media

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ASX200 Miners Collaborate on Greener Steelmaking with $19.8M Boost from ARENA — Image source: Shutterstock

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Highlights

$19.8M grant awarded to develop greener steel tech

ASX200 companies unite for electric smelting innovation

NeoSmelt project targets 2028 pilot launch

Australia's major mining and energy giants—Bluescope Steel (ASX:BSL), BHP Group (ASX:BHP), Rio Tinto (ASX:RIO), Woodside Energy (ASX:WDS), and Mitsui & Co.—are joining forces under a transformative initiative aimed at decarbonising the steelmaking industry. Backed by a $19.8 million grant from the Australian Renewable Energy Agency (ARENA), this joint venture will develop a front-end engineering design (FEED) study for a pilot electric smelting furnace.

This collaboration, known as the NeoSmelt project, is set to take place in Western Australia’s Kwinana Industrial Area. The grant supports a total project value of $48.8 million, demonstrating a strong public-private commitment to industrial decarbonisation.

The NeoSmelt pilot will explore an alternative to traditional coal-based blast furnaces. Initially using natural gas to reduce iron ore, the process will convert the material into liquid iron via an electric smelting furnace. In its long-term vision, the project intends to replace natural gas with hydrogen, making the process substantially lower in emissions.

The initiative reflects a broader trend among ASX200 index to integrate low-emissions technologies into traditionally high-carbon industries.

A final investment decision is expected by 2026, with operations targeted for 2028. This timeline aligns with broader national objectives to position Australia as a leader in low-emissions manufacturing and energy innovation. The federal funding stems from the $400 million Industrial Transformation Stream under the $1.9 billion Powering the Regions Fund. Notably, the Western Australian government has also pledged $75 million to support the pilot.

The project stands as a landmark collaboration between industry leaders focused on hard-to-abate sectors. By reimagining the steel value chain with advanced electric smelting, the venture could significantly reduce carbon emissions and set new benchmarks in global steel production.

As government and industry partnerships strengthen, this project could signal the emergence of Australia as a hub for clean-tech innovation within ASX200 frameworks. With timelines in place and funding secured, NeoSmelt is poised to play a crucial role in shaping the future of sustainable steelmaking.

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