Iron-ore giant Fortescue Metals Group Ltd. sold $1.5 billion in bonds that include a portion earmarked to benefit the environment, the latest effort by its billionaire founder Andrew Forrest to pivot into the booming green market.

The Australian miner, through its FMG Resources (August 2006) Pty Ltd. unit, tapped the U.S. high-yield market with a two-part bond deal on Wednesday, according to a person with knowledge of the matter.

The 10-year tranche is an $800 million green bond, said the person, who asked not to be identified as the details are private. It’s the first such debt from the company and the biggest dollar-denominated green junk bond tranche since early December, according to data compiled by Bloomberg.

Proceeds from Fortescue’s debut sale of green bonds will be used to finance or refinance new or existing eligible green projects -- which may include renewable energy, energy efficiency, storage, clean sea and coastal freight transport, according to Fortescue’s sustainability financing framework.

The green-bond market is exploding as governments and companies across sectors rush to raise money to fund their sustainability goals amid pressure from investors and regulators. Sales of the debt reached a record $513 billion last year, according to data compiled by Bloomberg.

Climate Bonds Initiative, a London-based organisation that sets green-bond standards, estimates annual sales could reach fresh highs of between $900 billion and $1 trillion by the end of this year -- and as much as $5 trillion by 2025.

It took the Perth-based billionaire -- widely known as “Twiggy” in Australia -- a little over a decade to build an iron-ore empire to challenge major companies. Now he’s set himself an equally ambitious timeline to create a global powerhouse in clean energy.

Fortescue, the world’s fourth-largest producer of iron ore, has a 2040 target to reach net-zero greenhouse gas emissions from its steelmaking customers.

Bloomberg