Billionaire Andrew Forrest is scaling back his ambitious plans to transform Australian miner Fortescue Ltd. into a green hydrogen powerhouse, citing high energy prices as a major obstacle. This setback has led to an overhaul of the group and the elimination of 700 jobs.
Forrest, the company’s founder and executive chairman, has been striving to pivot from iron ore, which continues to generate the majority of the company’s revenue, by making significant investments in green technologies. However, the company has experienced a wave of senior departures over the past few years, casting doubt on its strategy. A Fortescue spokesperson told ‘Bloomberg’ that the target of producing 15 million tons of green hydrogen annually by 2030 has been postponed until electricity prices decrease. Consequently, efforts on the technology are being scaled back across the board.
The company announced the job cuts in a statement on Wednesday as part of an overhaul to simplify the business’s structure but didn’t say which parts of the group would be affected.
The ‘Australian Financial Review’ quoted Forrest stating that the conflicts in Ukraine and the Middle East have driven up global energy prices, rendering large-scale green hydrogen production unfeasible.
