The founder of Fortescue Metals Group, one of the world’s biggest producers of iron ore, has accused western politicians of “propping up the Kremlin” by relying on natural gas imports from Russia instead of ramping up the production of alternative energy capabilities.
Andrew Forrest said the only beneficiary from widespread energy price rises was the Russian government as he called out leaders in the west for not doing enough to move away from their reliance on gas imports from the country.
“Natural gas is Putin’s power,” the billionaire businessman said in a speech at the FT Hydrogen Summit on Thursday.
He said western countries should be looking to renewable sources of power like wind and solar energy to replace fossil fuels faster.
His comments came on the same day that Russia placed sanctions on Forrest, banning him from entering the country.
While some European countries have stopped buying Russian gas, notably Poland and Bulgaria, which baulked at using a new payment mechanism introduced by Moscow, other members of the bloc have continued to purchase the fossil fuel. These include large utility companies in Germany and Italy.
“Keep buying it and keep propping up the Kremlin,” Forrest added.
Forrest, one of the richest people in Australia, has bold plans to build Perth-based Fortescue into one of the world’s biggest clean energy companies using the cash generated from its iron ore business to finance renewable power and other projects such as manufacturing electrolysers.
He is targeting 15mn tonnes of green hydrogen production every year by 2030, just 5mn tonnes less than the goal set by the EU in the same timeframe.
Asked how he would achieve this target he said Fortescue, which has emerged from a standing start to be the world’s fourth-biggest producer of iron ore, was used to “executing large capital projects” at a fraction of the cost of established competitors.
“Once we have green electrons [renewable power] the rest of it takes about 18 months. We’re going to deliver into our 2025 target for Germany. They have asked for 5mn tonnes and they are going to get it,” he said, referring to a recent deal with Germany energy company Eon.
Green hydrogen is produced from the electrolysis of water using renewable electricity. It does not produce carbon dioxide when burnt, supporting claims it could help solve some of the world’s dirtiest energy problems.
Forrest, who is Fortescue’s biggest shareholder, also called out oil and gas companies that are promoting blue hydrogen, which is produced from natural gas, and using carbon capture and storage technology to deal with the emissions. “That’s not carbon sequestration that’s greenwashing,” he said.
The methane, the largest component of natural gas, is estimated to have contributed to about 30 per cent of the global rise in temperatures to date, according to the International Energy Agency.
Asked about being sanctioned by the Kremlin, Forrest said he had no regrets about calling out Russian over the invasion of Ukraine.
“I don’t take it lightly, I take it seriously but I would say to other leaders in the room that you are not worth talking to unless you have been sanctioned.”