Fortescue share price falls as Twiggy calls fossil fuels ‘most dangerous industry in the world’

The Fortescue Metals Group Ltd (ASX: FMG) share price is falling today after its chair, Andrew ‘Twiggy’ Forrest, lambasted the fossil fuels industry in an interview with ABC program, 7:30. 

At the time of writing, the Fortescue share price is down 3.19% to $20.91 per share. 

Fortescue is one of the world’s biggest polluters. According to the report, emitting two million tonnes of carbon per year. It’s a giant Australian iron ore production and exploration company, with assets located in the Pilbara region of Western Australia.

It’s the fourth largest iron ore producer in the world. Coming in behind BHP Group Ltd (ASX: BHP), Rio Tinto Ltd (ASX: RIO), and Vale. However, unlike its competitors, Fortescue is aiming to be carbon neutral by 2030. 

Twiggy’s view on fossil fuels

Australia’s largest iron-ore producer, BHP, is aiming for carbon neutrality by 2050. Moreover, the Australian government is aiming to “preferably” be carbon neutral by 2050.

Forrest is hoping his company’s comparatively radical shift towards net-zero emissions can attract investors and good publicity. In addition, Forrest is aiming to future-proof Fortescue for the long term.

“Fortescue has decided to step up and take that first-mover risk. I believe it’s going to work, and we’ll keep on persevering until it does work,” he told 7.30.

“The fossil fuel industry is perhaps our most dangerous industry in the world right now. It’ll be economics which forces them to change, but they won’t go down without a serious fight.”

Fortescue won’t be including the emissions from its off-shore iron-ore processing in its 2030 target. However, Forrest is hoping by pioneering Australian companies’ switch towards green hydrogen production, he can spearhead a technological change.

“What I need to do is not a Pyrrhic victory, or virtue signalling, like saying, I’m going to try and stop my customers from using coal. I can’t stop them using coal,” he continued.

“What I’m now working on is a replacement for coal, and that’s green hydrogen.”

Australia’s ‘green hydrogen future’

Hydrogen is currently relatively expensive and carbon-intensive to produce compared to lithium batteries, however many scientists believe it has the potential to replace lithium batteries in the future.

Fortescue is currently in talks with the Jordanian government over investing in hydrogen production facilities in the Middle East, but he says Australia could potentially become the world’s largest producer of renewable energy source.

“Then we could well be that Middle East of energy. We need to grasp that opportunity,” he said.

“With a little bit of vision, a little bit of drive and a little bit of risk, could we create a massive new industry which creates the steel which the world needs, which is zero carbon steel?” 

“That’s our future.”

Fortescue share price snapshot

While the Fortescue share price is the only one of Australia’s big three iron-ore producers to fall overall in 2021, it’s still up more than 90% over the past 12 months.

The Fortescue share price has more than doubled, from just over $10 in May 2020 to its current price today.

More reading

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• 5 things to watch on the ASX 200 on Wednesday
• ASX 200 drops, Challenger plummets, Lynas falls
• Aussie dollar shoots higher! Here are some ASX winners

Motley Fool contributor Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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