Brazilian mining giant Vale has taken a significant step in its mission to reduce carbon emissions by entering a partnership with Green Energy Park (GEP) to accelerate green hydrogen production. The agreement aims to develop Mega Hubs in Brazil, where Vale will produce iron ore agglomerates, such as pellets or briquettes, to support low-carbon steel production using renewable hydrogen as the reducing agent.
The collaboration is part of Vale’s broader strategy to foster Brazil’s low-carbon industrial development. The new hubs will focus on producing hot briquetted iron (HBI), a key material in steelmaking, which will then be supplied to European steelmakers. Renewable hydrogen will play a crucial role in reducing emissions associated with steel production, offering a pathway to decarbonising the sector.
Ludmila Nascimento, Vale’s Director of Energy and Decarbonisation, called the partnership a “win-win” for Brazil and Europe. “We are leveraging Brazil’s competitive advantages, such as high-quality iron ore and abundant renewable energy, to potentially develop green hydrogen supply. This will allow us to offer ‘green’ HBI to European steelmakers, while promoting Brazil’s new industrialisation based on the low-carbon economy and fighting climate change,” Nascimento said.
Bart Biebuyck, CEO of GEP, emphasised the importance of the collaboration in achieving Net Zero targets. “This partnership with Vale is a major milestone on our journey to Net Zero. We are proud to work with the world’s largest producer of direct reduction pellets to help decarbonise the steel sector. Together, we aim to introduce green hydrogen technology to the core of the hard-to-abate industries, providing a competitive platform for green steel production in Europe and beyond,” Biebuyck said.
The global steel industry is one of the largest contributors to carbon emissions, accounting for around 8% of the world’s total emissions due to the extensive use of coal in blast furnaces. Current processes emit approximately 2 tonnes of CO2 for every tonne of steel produced in a blast furnace. In contrast, the direct reduction process using green hydrogen can cut emissions by 80%, bringing it down to 0.4 tonnes of CO2 per tonne of steel when used in Electric Arc Furnaces (EAFs).
Vale’s Mega Hubs are set to play a key role in tackling this challenge, contributing to global efforts to achieve a carbon-neutral economy by 2050. Green Energy Park, supported by Europe’s Global Gateway program, will bring its expertise in electrolyser technologies and the deployment of hydrogen production plants. The partnership will also focus on the development of storage and handling facilities for hydrogen and its derivatives, contributing to the wider hydrogen value chain.
As part of the project, GEP will use advanced engineering designs, including cryogenic gas handling and storage, to drive down costs and make green hydrogen more accessible. These innovations, combined with Vale’s vast industrial capabilities, are expected to create a competitive platform for producing green steel on a global scale.
The partnership is expected to not only advance industrial decarbonisation but also position Brazil as a leader in green hydrogen technology, driving sustainable development in the region.