South Australia strikes 10‑year gas deal for Whyalla Steel Plant’s DRI shift

It will supply 200 petajoules of gas over the said period.

South Australia has signed an agreement with Santos to supply 200 petajoules (PJ) of gas over 10 years for the Whyalla steel plant’s shift to direct reduced iron technology, according to analysis by the Institute for Energy Economics and Financial Analysis (IEEFA).

Most of the 200PJ is allocated to replacing the plant’s coal-based blast furnace with direct reduced iron technology that can run on gas or green hydrogen.

Santos signed a memorandum of understanding in February 2024 with the plant’s former owner GFG Alliance for gas supply.

Steelmaking via gas-based direct reduced iron releases 1.66 tonnes of greenhouse gases per tonne of crude steel produced, according to the World Steel Association cited in the analysis.

The 2024 Santos and GFG memorandum said the planned direct reduced iron plant would use a mix of natural gas and green hydrogen as the reducing agent, with the aim of fully transitioning to green hydrogen as it becomes available at scale.

The South Australian government has shelved its planned green hydrogen project earmarked to supply Whyalla and disbanded its Office of Hydrogen Power.