BP is working to decarbonise steel production through a partnership with Germany’s Thyssenkrupp Steel that will aim to involve the supply of low-carbon hydrogen and renewable power.
The two companies signed a memorandum of understanding to reduce carbon dioxide emissions at Thyssenkrupp’s Duisburg facility, where its blast furnaces are operated.
While much public attention looks toward oil and gas operations to reduce emissions, steel accounts for 8% to 11% of global CO2 emissions.
Companies are looking for ways to create what is known as ‘green steel’, which uses hydrogen or electricity instead of coal in its blast furnaces, significantly reducing emissions.
Thyssenkrupp, which produces about 11 million tonnes per annum of crude, aims to produce 400,000 tonnes of CO2 reduced steel by 2025. The company alone accounts for 2.5% of CO2 emissions in Germany.
“The steel and energy industries have of course long been closely linked. We provide fuel and feedstock for steel production while our platforms, pipelines, and turbine towers are made from steel,” said William Lin, BP’s executive vice president of regions, cities and solutions.
“Thyssenkrupp Steel has the ambition to make its steel production climate-neutral by 2045 and low carbon power and hydrogen will play a critical role in achieving that. With our aligned ambitions and complementary investments, Thyssenkrupp Steel and BP can together help this hard-to-abate sector decarbonise faster.”
BP and Thyssenkrupp will replace coal-fired blast furnaces at the Duisburg site with direct reduction plants where iron ore is reduced with low-carbon hydrogen. The companies intend to explore supply options for both blue and green hydrogen, along with wind and solar power.
Through the partnership, BP and Thyssenkrupp also intend to jointly advocate for policies that support the growth of low-carbon hydrogen and green steel in Europe.
"The decarbonisation of the steel industry will require enormous quantities of low-carbon and in the long term green hydrogen. This will increasingly require the use of electricity from renewable sources,” said Arnd Kofler, chief technology officer at Thyssenkrupp Steel.
“All this can only be achieved through a well-developed hydrogen infrastructure with a supra-regional pipeline network. The MoU is an important milestone for us to set the course with BP for a reliable supply of energy in the future."