Ferrexpo announces decarbonization targets

Ukraine’s largest iron ore pellet exporter Ferrexpo
(FXPO LN) announced its inaugural decarbonization targets in an Oct. 11
release.

The company plans to achieve a minimum of 30%
reduction, on a per ton basis, in combined Scope 1 and 2 emissions by 2030
against the 2019 baseline year.

According to Ferrexpo’s 2020 responsible business
report (RBR), in 2019 it emitted 133.6 kg of CO2 per ton of pellets produced,
comprising 55.1 kg/t of Scope 1 (including from consumption of diesel, 23.5
kg/t, and natural gas, 22.8 kg/t) and 78.5 kg/t of Scope 2 (mostly 76.1 kg/t
from electricity consumption).

In 2020, its Scope 1 and 2 CO2 emissions dropped 16%
yoy to 112.6 kg/t, according to the 2020 RBR. By June 2021, Ferrexpo had
recorded a reduction in excess of 20%, according to the release.

Ferrexpo also commits to achieve net zero carbon
emissions from its operations by 2050, the release said.

The company has engaged climate specialists Ricardo
plc to develop science-based reduction targets and a timeline for the stages of
decarbonization.

Dmytro Khoroshun: Ferrexpo’s
30% Scope 1 and 2 reduction target for 2030 looks realistic. The company will
likely pursue it by decreasing its Scope 2 emissions related to electricity,
including by developing own solar electricity generation capacities,
we conclude from its 2020 RBR.

Furthermore, Ferrexpo’s Scope 3 emissions represented
91% of its total emissions on a per ton basis in 2020, and the company can
actively manage and reduce its Scope 3 emissions by increasing the production
of direct reduction pellets, according to its 2020 RBR.