Slide 1: Decarbonising steelmaking: technology options and regional pathways
Decarbonising steelmaking: technology options and regional pathways Huw McKay Chief Economist Ben Ellis Head of Marketing Strategy and Technical Marketing Wenjun Bao Manager Steel and Nonferrous Analysis Lee Levkowitz Manager Energy and Technology Research 11 November 2020
Slide 2: Disclaimer
Disclaimer Forward-looking statements This presentation contains forward-looking statements, including statements regarding: trends in commodity prices and currency exchange rates; demand for commodities; production forecasts; plans, strategies and objectives of management; closure or divestment of
Slide 3: Climate change scenarios
Climate change scenarios Our portfolio is tested across a range of futures 1.5 degrees Lower Carbon View Central Energy View Climate Crisis A climate shock leads to turmoil and Paris Agreement goals met through Faster and deeper decarbonisation Reflects our view on the most likely massive economic c
Slide 4: Steel emissions have roughly doubled in the last three decades
Steel emissions have roughly doubled in the last three decades, with rising demand dominating a major efficiency uplift Steel emissions1 Carbon intensity in 2019 Metallic mix in 2019 BF plant age2 in 2019 (Mt CO2) (t CO2 / t steel) (sum = 100%) (average in years) 4,000 Pig iron DRI Scrap Global aver
Slide 5: BAU passive abatement to barely offset demand growth to 2050
BAU passive abatement to barely offset demand growth to 2050 Estimated global steel emissions (Mt CO2) 5,000 4,000 3,000 ‘Passive abatement’ 2,000 1,000 0 1990 Steel Emissions 2019 Steel Central-case Central 2050 Emissions output intensity output scrap and Energy View BAU intensity 2.2 increase¹ dec
Slide 6: BHP's three stage steel decarbonisation framework
BHP’s three stage steel decarbonisation framework Each region will transit through these stages at its own pace, based on unique local conditions faced by steelmakers Optimisation stage Transition stage Green end state 20% CO2 reduction vs. BAU 50-60% CO2 reduction vs. BAU 90% CO2 reduction vs. BAU
Slide 7: Key regions in 2050 under Central and Lower Carbon cases
Key regions in 2050 under Central and Lower Carbon cases Optimisation stage Transition stage Green end state Energy optimisation Low carbon fuels Green hydrogen DRI Raw material optimisation Modified blast furnace Electrolysis Technology improvements End of pipe CCUS Now Central 2050 Lower Carbon 20
Slide 8: Global scenarios and a bottom-up view of regional pathways
Global scenarios and a bottom-up view of regional pathways Lever Global steel emissions 2050 ‘Lower Carbon’ case vs. BAU steel emissions saving abatement (Mt CO2) (%) costs IEA STEPS 60 EU Low 2019-50 BAU Process optimisation ‘Central’ North High-quality Developed raw materials Other America ~30% AP
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Slide 10: Appendix
BHP Appendix
Slide 11: Most of our commodities benefit in a decarbonising world
Most of our commodities benefit in a decarbonising world As decarbonisation accelerates the world will require more copper, nickel, potash and steel 1.5°C Scenario Central Energy View Cumulative demand in the next 30 years compared to the last 30 years Lower Carbon View (%) Oil demand outlook (%, in
Slide 12: Snapshot of global steelmaking as of 2019
Snapshot of global steelmaking as of 2019 Country / Region Crude steel Global share BOF / OHF share EAF / IF share DRI in EAF BF plant age3 (Mt) (%) (%) (%) (%)2 (years) China 996 53 90 10 1 12 India 111 6 44 56 57 18 Developed APAC 199 11 71 29 1 37 Other APAC 481 3 31 69 5 6 European Union 159 8 5
Slide 13: Steel emissions by 2050 for key regions
Steel emissions by 2050 for key regions Regional steel emissions 2019 – 2050 (Mt CO2) China India Developed Asia-Pacific European Union 2,000 0 Base BAU Central Lower Base BAU Central Lower Base BAU Central Lower Base BAU Central Lower Carbon Carbon Carbon Carbon 2019 2050 2019 2050 2019 2050 2019 2
Slide 14: Partnering with China Baowu to address Scope 3 emissions
Partnering with China Baowu to address Scope 3 emissions Supporting industry decarbonisation in line with our Scope 3 goals through partnership with one of the world's largest steel makers Steel sector decarbonisation CCUS • First major project under BHP’s Climate Investment Program • Use of BHP hig
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