Oman-based Jindal Shadeed Group, which is the largest privately-owned integrated steel producer in the GCC, recently announced an investment of more than $3 billion to set up a renewable-powered green steel plant in Duqm’s Special Economic Zone, which is the largest economic zone in the Middle East and will produce high-strength automotive products for customers in the Middle East, Europe, and Japan.
In an exclusive interview with Oil & Gas Middle East, Harssha Shetty, CEO of Jindal Shadeed, talks more about the hydrogen-powered project that can process 5 million tons of steel a year and will supply several industries including the wind sector.
Oil & Gas Middle East: Can you discuss how the steel production initiative in Oman will impact the energy industry?
Shetty: Firstly, we are producing 2.5 million tonnes of steel, which is at 45% lower carbon emissions. Also, nearly 40% of our production goes to the oil and gas industry. So, we are already helping to reduce the carbon footprint of the sector.
We are proudly made in GCC region and we would prefer to give priority for the decarbonisation of this region. We have recieved a natural gas allocation from the government of Oman for this plant, which will be great as we transition to green hydrogen in the future. When players like us start something, it also encourages other producers to start acting in the same direction. Their risk actually goes down after the first project establishes and demonstrates success. And with steel being one of the biggest source of GHG emissions, it is going to help a lot when such products like green steel take off in this region.
Oil & Gas Middle East: Please talk about Jindal’s approach toward sustainability.
Shetty: Oman has a target of net zero or significant reduction in carbon emissions by 2050. Another very important part of the vision is that they want 92% of their GDP to be from the non-oil sector. So, this project has significance for accelerating green hydrogen in Oman. Now, when a steel company like us build a green hydrogen steel plant, it’s a huge step toward enabling the country in its decarbonisation efforts and becoming net zero by 2050.
And another important thing is that once a 5-million-tonne green steel facility comes into one particular economic zone, there is a multiplier effect. When you invest $100 in primary steelmaking, more than $300 gets created in terms of GDP.
Oil & Gas Middle East: Can you discuss your expansion plans in the Middle East region?
Shetty: We have already invested in a new plant to produce 6 million tons of pellets per year and we are also producing our own Ferro alloys. By doing this, we are further reducing carbon emissions, because we will not be moving raw materials from anywhere else.
We are a GCC-focused company and being the largest private steel producer in the region, we are not averse to any attractive opportunities that come to our attention. We are backed by the largest steel family of India, the Jindal family with over $35 billion in revenues currently. Today, if you look at their current steel production and the expansions planned by 2030, there will be more than 60 to 70 million tons of steel produced by the group in India by 2030.
[Editor’s note: This interview has been edited for length and clarity.]
So that experience is something which we are going to take forward. In the GCC region, we are always open to attractive opportunities, which are equity, shareholder value equity. So, while currently our focus is in Oman because we have projects running here, any projects that come to our attention, we will definitely consider them.