China-Australia relations: Rio Tinto makes anti-pollution deal with world’s largest steel producer amid iron ore price controversy

Funding is an extension of last year’s agreement between Rio Tinto, China Baowu and Tsinghua University to reduce carbon emissions in the steel supply chain

Chinese President Xi Jinping vowed earlier this month that China would reduce its carbon dioxide emissions by ‘at least’ 65 per cent from 2005 levels by 2030

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Anglo-Australian miner Rio Tinto has earmarked millions of US dollars for research into reducing carbon emissions in the steel supply chain. Photo: AFP

Published: 4:30am, 18 Dec 2020Updated: 6:05am, 18 Dec 2020

Anglo-Australian miner Rio Tinto has agreed to invest millions of dollars in low-carbon steelmaking projects and research alongside the world’s largest steel producer, China Baowu Steel Group, for the next two years, in a show of partnership as concerns of an iron ore trade rupture continue to froth.

The US$10 million investment is an extension of a 2019 agreement between Rio Tinto, China Baowu and Tsinghua University to develop and implement new methods to reduce carbon emissions in the steel supply chain. The money will be used to fund the joint establishment of a Low Carbon Raw Materials Preparation R&D Centre to develop lower carbon ore preparation processes.

It will go towards paying for work on carbon dioxide utilisation at the China Baowu Low Carbon Metallurgical Innovation Centre, which is researching new technologies to create a low-carbon steel industry.

“This investment with our partners at China Baowu is an important step in our climate partnership,” Rio Tinto CEO Jean-Sebastien Jacques said in a press release, while indicating that the partners had already identified specific projects that could produce significant carbon-reduction solutions.

The Chinese industry has also taken steps to reduce emissions in an effort to line up with China’s goal of being carbon neutral by 2060.

Earlier this month, at the virtual Climate Ambition Summit 2020, Chinese President Xi Jinping vowed that China would reduce its carbon dioxide emissions by “at least” 65 per cent from 2005 levels by 2030, raising the target slightly from the country’s previous goal of “up to” 65 per cent.