Fortescue Metals Group Ltd (ASX: FMG) shares are deep in the red today, down 2.5% to $19.08 apiece.
The benchmark S&P/ASX 200 Index (ASX: XJO) is also down 0.85% today.
With no news out of Fortescue today, we can safely assume the share price drop is due to the falling commodity price.
The iron ore price fell below US$100 per tonne overnight to close at US$95.50, down 3.4%.
Fortescue shares have been weak of late, falling 7.6% over the past month.
Meantime, Fortescue has commenced a strategic review of its entire power plant operations, according to reporting in the Australian Financial Review (AFR).
Image source: Getty Images
Power plants under review
Fortescue has hired investment bank Citi to assess alternative power generation options for the company. The review will commence in the second half of 2023.
According to the article in StreetTalk:
Strategic review typically means M&A, and it'll be interesting to see what Citi's gun energy bankers come up with.
Last September, Fortescue laid out its decarbonisation strategy and US$9.3 billion budget to get it done.
The plan includes replacing fossil fuel power generation with renewables for its mining operations.
One of Fortescue's power plants is the Solomon Power Station. It powers several of its mines in the Pilbara region of Western Australia.
According to the article, Fortescue has already switched the plant from diesel to gas. It's also built a battery and transmission line from the plant to its Iron Bridge magnetite project.
There have been some concerns among ASX investors that Fortescue shares may not pay the generous dividends they are known for in coming years due to the vast decarbonisation spend.
In an investor presentation last week, Fortescue said it is "leading the world effort to decarbonise heavy industry".
The miner is aiming to reach "real zero" Scope 1 and 2 emissions by 2030 and Scope 3 emissions by 2040.
Tumbling iron ore price drags down Fortescue shares
Fortescue isn't the only ASX iron ore share in the red today.
BHP Group Ltd (ASX: BHP) shares have hit a six-month low, down 1.1% to $42.32 at the time of writing.
Rio Tinto Ltd (ASX: RIO) shares are down 1.2%, Mineral Resources Ltd (ASX: MIN) shares are down 2.8%, and Champion Iron Ltd (ASX: CIA) shares are down 2.2%.
