“It’s time for businesses to stop talking about long-term targets and completely ditch fossil fuels in the coming years rather than in the coming decades,” he states in a February 25 TIME article.
“If you think you can’t go green, then you’re right,” he says of his industry colleagues … It’s time for you to get off the stage and learn from someone with more talent, more conviction, or initiative than you who can lead your company.”
Fortescue’s vow to eliminate fossil fuels by 2030 and lower costs traces back to its US$6.2 billion investment in 2022, when it announced its plan for industry-leading decarbonisation. It said at the time that the investment was designed to eliminate its fossil fuel risk profile and enable it to supply customers with carbon-free products.
Notable big oil companies like BP (LSE:BP,NYSE:BP) and Shell (LSE:SHEL,NYSE:SHEL) have recently announced they will cut back on clean energy pledges, saying that they will focus more on oil and gas production.
BP said the decision is a strategic reset to reduce and reallocate capital expenditure to drive growth, pursue performance improvements and work on cost efficiency. Meanwhile, Shell CEO Wael Sawan explained that the company is providing the secure energy customers need at the present while working on its transformation to win in a low-carbon future.
Forrest believes big oil companies are getting it wrong, especially now that customers are in search of green energy.
“I’ve always found that the customer is always right, which is why we’re going renewable and moving away from oil and gas," he said on CNBC 's Squawk Box Europe on March 24.
"Our customers are saying, ‘We want energy, but not at any cost, and if you can give us green energy at the same price as dirty (energy) then we are going to buy green every day.’ That’s my job, and that’s Fortescue’s job."
He added, “Well, if (the) oil and gas (industry) doesn’t want to supply green energy, guess what, Fortescue will."
As the fourth largest iron ore producer in the world, Fortescue’s push to reduce fossil fuel dependency and emissions is a significant step toward sustainable mining practices.
Its US$6.2 billion investment to eliminate fossil fuels is expected to displace around 700 million litres of diesel and 15 million gigajoules of gas per year — reducing emissions by 3 million tonnes of carbon dioxide annually.
The company is also working toward its green fleet, developing battery-electric haul trucks and exploring hydrogen- and ammonia-powered mining equipment to eliminate diesel consumption.
Green initiatives and developments
Fortescue has made a variety of advances into clean energy in recent years.
In March, Fortescue Green Pioneer, the world's first dual-fueled ammonia-powered vessel, docked in London. It is on a global tour of ports aimed at fast-tracking international shipping’s transition to green fuels.
In 2020, the company announced the US$450 million Pilbara generation project, which aims to enhance Fortescue's power-generation capacity using 150 megawatts (MW) of gas-fired power with 150 MW of solar photovoltaic generation and 50 MW of battery storage. The project is part of the Pilbara Energy Connect (PEC) initiative.
Fortescue completed the first phase of PEC in 2024. Included was a 100 MW solar farm at North Star Junction and 140 kilometres of transmission lines and substations.
In an update via X on Wednesday (April 2), the company said that the 100 MW solar farm at North Star is currently supplying over 25 percent of Iron Bridge’s energy demands.
Another project, a 190 MW solar farm at Cloudbreak, is expected to be completed in 2027. Fortescue said this will significantly reduce its diesel and gas consumption.
A 640 MW Turner River solar project has also been proposed by the company, which has said it could become Western Australia’s largest green energy initiative. The proposal was submitted by Fortescue's subsidiary, Pilbara Energy, to the Western Australian Environmental Protection Authority.
Sinead Booth, Fortescue's group manager of decarbonisation delivery, said that these initiatives are crucial as the company continues to reduce emissions and advance its commitment to a sustainable future.
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Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.
Figure 1 - Location of Project Iron Bear
