Rio Tinto (ASX, LON: RIO) committed with the world’s largest steel producer, China Baowu Steel Group, to invest $10 million over the next two years in low-carbon steelmaking projects and research.
In a press release, the mining giant said its investment will fund the joint establishment of a Low Carbon Raw Materials Preparation R&D Centre, which will initially prioritize the development of lower-carbon ore preparation processes.
“This will include creating two ore preparation pilot plants, one to use biomass and the other exploring using microwave technology,” the media brief reads.
“The investment will also support work on carbon dioxide utilization and conversion at the China Baowu Low Carbon Metallurgical Innovation Centre, which is a Baowu-led open platform for advancing metallurgical technologies to support the low-carbon transformation of the steel industry.”
It is estimated that the production of steel is responsible for between 7% and 9% of global emissions.
Rio’s recent commitment is part of the partnership the company formed last year with China Baowu and Tsinghua University to develop and implement new methods to reduce emissions and improve environmental performance across the steel value chain.
“To deal with global climate change and achieve green transformation through cooperation has become the consensus and common practices of the global steel value chain,” China Baowu chairman, Chen Derong, said in the release.
“It requires collective action of the steel enterprises, as well as upstream and downstream players. We highly appreciate Rio Tinto’s commitment to advancing a low-carbon future.”
In Derong’s view, China Baowu’s leadership in advancing low-carbon steel solutions is an important pillar in supporting China’s target of striving to be carbon neutral by 2060.