“It should never have left:” Steel making returns to Newcastle with renewables and no fossil gas

Australia’s first new steel mill in three decades will be unlike any that came before it.

Run entirely on electricity, the Greensteel Australia factory to be built in the NSW Hunter region will make steel that’s low emissions and unencumbered by fossil fuel supply chains.

To be built on the site of the old BHP Newcastle Steelworks in Mayfield, the Sydney-based company’s $500 million investment marks the return of steel-making to the state’s manufacturing heartland.

The plant is expected to be up and running by early 2028, producing 600,000 tonnes of finished steel a year and employing 200 full-time staff.

The announcement on Tuesday marks the first of a multi-stage project that will leverage hydrogen-fuelled direct reduced iron technology, electric arc furnace steelmaking, renewable energy and global industrial partnerships.

The mill will rely on electricity to generate heat and make steel with no direct greenhouse gas emissions.

The traditional method of using giant gas-fired furnaces is intensively carbon-intensive, with the global iron and steelmaking industry responsible for roughly one-tenth of all emissions.

“Every tonne of steel we forge at Mayfield is a tonne Australia doesn’t have to import,” Greensteel Australia chairman Ross Garnaut said.

“That means more reliable supply and better prices for builders, and because there is no gas anywhere in our process, it also means lower embodied carbon in the homes and infrastructure this country needs.”

A local supply of steel made without exposure to volatile gas markets should help lower home-building costs, he said, helping Australia meet housing construction targets.

Company chief executive Romany Ibrahim said the Commonwealth’s Future Made in Australia strategy and other state and federal policy settings on housing and manufacturing had provided the confidence necessary for the project to go ahead.

“Thanks to the leadership of the NSW and federal governments, we’re building again,” he said. 

“They’ve made it possible to bring manufacturing home to Newcastle, where Australian steelmaking began and where it never should have left.”

AAP