The strategy will see the Company lead the market in terms of its response to growing customer, community and investor expectations to reduce/eliminate carbon emissions. Fortescue expects to generate attractive economic returns from its investment arising from the operating cost savings due to the elimination of diesel, natural gas, and carbon offset purchases from its supply chain. Fortescue is well positioned to capitalise on first-mover advantage and the ability to commercialise decarbonisation technologies.
Fortescue made the announcement at the invitation of US
Fortescue also announces that the Science Based Targets Initiative (SBTi), will verify and audit its emissions reduction. This technical auditing initiative was instituted to ensure companies reach their Paris Agreement goal to limit global warming to 1.5 degrees.
Fortescue's decarbonisation journey started on the commencement of the first major trip on
When fully implemented, Fortescue's decarbonisation strategy and associated investment will provide significant environmental and economic returns by 2030, including:
Avoidance of 3 million tonnes of CO2 equivalent emissions per annum
Net operating cost savings of
Cumulative operating cost savings of
Elimination of Fortescue's exposure to fossil fuels and associated fossil fuel price volatility which in turn, will de-risk the operating cost profile
Removal of the Company's exposure to price risks associated with relying on carbon offsets as well as carbon tax regulatory risk
Establish a significant new green growth opportunity by producing a carbon free iron ore product and through the commercialisation of decarbonisation technologies
Ensuring future access to green driven capital markets.
The capital estimate is
The investment is expected to generate a positive net present value (NPV) through enabling the displacement of approximately 700 million litres of diesel and 15 million GJ of gas per annum by 2030, as well as the associated reduction in CO2 emissions.
Fortescue Executive Chairman, Dr
'We are already seeing direct benefits of the transition away from fossil fuels - we avoided 78m litres of diesel usage at our Chichester Hub in FY22 - but we must accelerate our transition to the post fossil fuel era, driving global scale industrial change as climate change continues to worsen. It will also protect our cost base, enhance our margins and set an example that a post fossil fuel era is good commercial, common sense.
'Fortescue, FFI and FMG, is moving at speed to transition into a global green metals, minerals, energy and technology Company, capable of delivering not just green iron ore but also the minerals, knowledge and technology critical to the energy transition.
'Consistent with Fortescue's disciplined approach to capital allocation, this investment in renewable energy and decarbonisation is expected to generate attractive economic returns for our shareholders through energy cost savings and a sharp reduction in carbon offset purchases, together with a lower risk cost profile and improvement in the integrity of our assets.'
Fortescue has already made significant effort in decarbonising its iron ore operations through its successful green fleet trials and innovation, acquisition of
Contact:
Level 2 87
East Perth WA 6004
Telephone: +61 8 6218 8888
Facsimile: +61 8 6218 8880
(C) 2022 Electronic News Publishing, source