Maritime, mining, and energy majors to create a green corridor for iron ore

A new consortium comprising UK-based mining company Anglo American, Tata Steel, CMB, VUKA Marine, Freeport Saldanha, and ENGIE plans to explore the options for developing a maritime green corridor for the zero-emission shipping of iron ore between South Africa and Europe.

The initiative has been described as the first of its kind from Africa and an important step in the region’s involvement in shipping’s decarbonization.

Maritime green corridors are routes between major port hubs where zero-emission solutions and fuels are supported and demonstrated, and they have been gaining in popularity over the past few years.

The consortium will look at bunkering and offtake arrangements, available green fuel supplies, and financial and business model alternatives.

According to the Global Maritime Forum, an international not-for-profit organization, headquartered in Copenhagen, Denmark, the consortium’s initiative to explore the development of the green corridor between South Africa and Europe builds on “Shipping’s Energy Transition: Strategic Opportunities in South Africa,” a report prepared by P4G and the Getting to Zero Coalition.

The report identified promising opportunities for South Africa to establish itself as a key player in the global transition to renewable forms of energy and zero-emission shipping.

South Africa has the highest volumes of maritime traffic in Africa outside of the Mediterranean region, as well as one of the best-connected port systems on the continent that support the trade of valuable commodities. The development of the green corridor could help drive forward South Africa’s decarbonization ambitions and serve a range of wider national and international objectives.

“It is fantastic to see this powerful industry consortium come together around a new green corridor with one side in South Africa, particularly as it sends a clear signal of industry action as we go into negotiations at MEPC 80 in July,” says Johannah Christensen, CEO of the Global Maritime Forum. 

“We hope this project will lay bare a viable shipping decarbonization pathway towards real-world implementation, generating sustainable growth and business opportunities for South Africa and the region, with synergies for other sectors of the economy.”

“Cross-industry collaboration is the key to shaping a sustainable maritime industry,”  says Peter Whitcutt, CEO of Anglo American’s Marketing business.

“An important step toward wider industry decarbonisation, this initiative also aligns with Anglo American’s ambition to reach carbon neutrality for our controlled ocean freight by 2040.”

As part of the strategy, the company is deploying a series of ten vessels powered by LNG. The fleet is expected to deliver an estimated 35% reduction in CO2 emissions compared to ships fueled by conventional marine oil fuel.

“Tata Steel is committed to zero carbon shipping ambition and our participation in South Africa- Europe green corridor for iron ore is yet another step in this direction. We believe in just transition wherein the financial risk of a sustainable supply chain is spread across all stakeholders – the supplier, ports, vessel owners, and buyers. The success of this corridor will likely accelerate the shipping industry’s journey towards decarbonized ocean transportation,” says Ranjan Sinha, Chief Group Shipping at Tata Steel.

“CMB is proud to be part of the Green Corridor initiative between South Africa and Europe. CMB has already built various ship types that run on hydrogen and is building dry bulk vessels powered by ammonia. We hope that our track record in the development of green ships will contribute to the success of the consortium and accelerate the deployment of low carbon vessels on this important trade route,” says Alexander Saverys, Chief Executive Officer at CMB.

“VUKA Marine is committed to developing solutions that align shared priorities and shared values across the maritime value chain.  The Green Corridor concept has the potential to accelerate solutions that can bring environmental priorities to the centre of route development,” says Andrew Mthembu, Chairman of VUKA Marine.

“As a pioneering special economic zone operator in South Africa, our company is thrilled to join forces with the key players in the industry to support shipping’s transition to a zero-emission future. With our expertise, we are excited to provide insights into the potential production of green fuels, vessel manufacturing, and servicing in Saldanha Bay,” says Kaashifah Beukes, CEO of Freeport Saldanha.

“ENGIE is eager to bring our global expertise and knowledge encompassing the entire hydrogen value chain to accelerate the establishment of the iron ore green corridor between South Africa and Europe. We are committed to building a carbon neutral world, and renewable hydrogen is key to decarbonizing hard-to-abate and energy intensive industries such as maritime transportation,” says Jonathan Debasc, ENGIE’s Managing Director, Flexible Generation & Retail, Africa.