The collaboration aims to develop hydrogen-based direct reduced iron (DRI) technology and look at the role of iron ore lump utilisation to help reduce emissions from ironmaking and steelmaking. It will also cover the recycling and reuse of steelmaking slag.

The companies plan to invest up to US$15 million over three years, with BHP's investment contribution to come from its US$400 million Climate Investment Program.

"By forming this third low-carbon steelmaking partnership with HBIS Group, we are focusing on…the role our products play in hydrogen-based steel production, that complement our other partnerships and support for endeavours in emissions reduction and capture from the traditional blast furnace route," BHP chief commercial officer Vandita Pant said.

BHP CEO Mike Henry added: that global decarbonisation will mandate the need for collaboration and collective efforts.

"Our work with partners such as HBIS Group will build on our own actions and help reduce emissions right through the value chain," he said.

The collaboration comes after BHP's announcement of reducing emissions through renewable energy supply contracts for its Queensland coal mines and Nickel West operations.