By David Winning 

SYDNEY--BHP Group Ltd. said it would use a fleet of new vessels powered by liquefied natural gas to transport iron ore from Western Australia and China from 2022, part of efforts to lessen its contribution to global warming.

BHP said the award of a tender for five LNG-fuelled Newcastlemax bulk carriers to Eastern Pacific Shipping aimed to bring down greenhouse gas emissions by more than 30% per voyage. The contract with EPS will last five years, and BHP said it expected to award the LNG bunkering supply deal in October.

Vandita Pant, BHP's chief commercial officer, said the LNG-fuelled vessels would virtually eliminate sulfur oxide emissions and significantly reduce carbon dioxide and nitrogen oxide emissions.

"The tender marks a progressive shift for BHP and the broader mining and shipping industry and is a significant step toward lowering greenhouse-gas emissions in the 1.5 billion-ton iron ore seaborne market," she said.

BHP released the LNG-fuelled bulk carrier tender in July last year.

"The LNG bunkering time charter contract, with a total cost of ownership less than a conventionally fuelled Newcastlemax, will enable BHP to manage the fuel supply risk, build LNG operations capability internally and capture operating expenditure benefits through optimization of voyage operations and fuel utilization," Ms. Pant said.

BHP produced 248 million metric tons of iron ore in the year through June, 4% more than in the 2019 fiscal year. China is the world's largest buyer of the steelmaking commodity, importing around three in every five cargoes of iron ore traded by sea.


Write to David Winning at


(END) Dow Jones Newswires

September 03, 2020 19:15 ET (23:15 GMT)

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