The splitting up of Anglo American following BHP’s rejected proposal will trigger a rethink of various shared projects and services across the group. One of those is the hydrogen truck, a project in the Anglo group’s FutureSmart innovation hub.
At the outset, Anglo American was motivated to back the development of hydrogen fuel cell vehicles to stimulate demand for platinum group metals (PGMs), which serve as catalysts in the fuel cell. Anglo’s 79.2% stake in Anglo American Platinum (Amplats), the world’s biggest platinum miner, stands to benefit if hydrogen fuel cell technology is proven to be commercial. (In an eye-catching marketing move, Anglo has launched hydrogen-fuelled taxis to support this year’s Olympic Games in Paris.)
Now, however, Anglo plans to focus on copper, iron ore, and (eventually) crop nutrients. Its metallurgical coal, nickel and manganese assets will be sold as well as its 85% stake in De Beers. Amplats will be unbundled.
Still, even without an interest in Amplats, Anglo could maintain a stake in the development of hydrogen fuel cell vehicles, at least in the short term. It has already made a large capital commitment to their development, which could earn a decent return if the technology is successful. Also, these vehicles can help mining companies to reduce their carbon emissions. Like most major miners hoping to attract and retain the world’s biggest pension fund investors, Anglo American has carbon emissions goals: it wants to be carbon-neutral by 2040. Replacing diesel with green hydrogen in its global mining fleet would make a significant difference, if these vehicles prove to be efficient and affordable.
Amplats CEO Craig Miller comments that the hydrogen truck, having proved the technology worked, has moved on to its next stage of development in the US, where it will be further tested. He laughs off suggestions that the truck is a white elephant with good humour. Commenting on the prototype, he says: “It went into the pit on several occasions, and it came out.”
The platinum industry faces a potential demand cliff as increasingly popular battery-powered electric vehicles do not use platinum and palladium in autocatalysts. If hydrogen-fuelled trucks can become the gold standard for mining fleets, it will benefit not only Anglo American Platinum and other PGM miners in South Africa, but also the domestic economy as a whole.
The South African government has thrown its weight behind green hydrogen production partly to support PGM mining but also because the country possesses the advantage of ample solar energy to manufacture “green” hydrogen. Hydrogen fuel cells can be used in both mobile (electric vehicles, in place of a battery) and stationary applications (power generation).
The hydrogen vehicle, which Anglo American calls the Zero Emission Haulage Solution (ZEHS), is a 220t truck with a 290t load capacity, converted from diesel to run on a combination of hydrogen fuel and a battery. When the truck goes downhill, through regenerative braking, it charges the battery.
The ZEHS has been tested for over 1 200 hours at Amplats’s Mogalakwena mine, which tackled the issue of fuel supply by building an on-site hydrogen production, storage and fuelling station.
In December 2022, Anglo committed $200m to further development by its specialist engineering technology partner, First Mode. This was followed by an agreement to decarbonise Anglo’s global mining fleet over the next 15 years.
“The progressive rollout of our low-carbon footprint haul fleet is subject to the successful completion of agreed-upon and committed studies across selected mine sites, specific performance and cost criteria, and approval of the relevant regulatory, corporate, and shareholder requirements,” says Nevashnee Naicker, Anglo’s spokeswoman. “The supply agreement also includes the appropriate provision of critical supporting infrastructure, such as refuelling and recharging, and the facilitation of hydrogen production.”
However, the commercial viability of hydrogen fuel cell vehicles is not a given, as the capital costs of hydrogen technology are not coming down as fast as originally expected.
On 19 May, the Financial Times’ Lex in depth reported that a lot of the hype around green hydrogen had not materialised. Only a fraction of the projects announced were being developed, and costs had escalated. An electrolysis plant costs about $2 000 per kW of capacity, about 65% more than developers originally expected to pay in 2024, and the costs of all the associated infrastructure (pipes, cables, water purification) have also increased.
“Hydrogen trucking also looks more challenging, given improving battery technology and the difficulty in providing hydrogen refuelling infrastructure,” the column said. As batteries improve, electric trucks will increase their payloads and ranges, it added.
Whether Anglo American retains its interest in using the ZEHS or not, the purpose of the partnership with First Mode was to house the project in a separate vehicle that was able to attract outside capital. So if it is a commercial proposition, it will stand on its own feet.
René Hochreiter, consulting mining analyst at Noah Capital, said he was confident that the ZEHS would go ahead. It was currently in the US undergoing further testing of certain components and once it was ready the developers were likely to get a bigger vehicle manufacturer to produce it on a larger scale.
The issue of hydrogen fuel supply to other mines could be tackled by sourcing from Sasol, which is already part of an agreement with Anglo Platinum and BMW SA to trial a hydrogen-fuelled BMW iX5 in Gauteng, he said.
However, Hochreiter said global take-up of hydrogen fuel cell vehicles was still several years away. Firstly, hydrogen fuelling infrastructure is very limited, even in Europe, although China and Japan are at a more advanced stage. Secondly, the swing towards right-wing governments in the West is likely to see a renewed focus on preserving jobs in the production of the internal combusion engine rather than developing fuel cell or battery electric vehicles. Both of those are expensive to make and unlikely to survive without subsidies.