One of BP’s projects is the Australian Renewable Energy Hub, a huge 26-gigawatt development spanning wind turbines, solar panels, green hydrogen and green ammonia, situated on 6500 square kilometres in Western Australia’s Pilbara.
It is also proposing 14 gigawatts of wind and solar at Geraldton to produce green hydrogen, as well as the H2Kwinana project, a hydrogen hub to be built at its former oil refinery in Perth, which closed in 2021.
Engineering work on the H2Kwinana hydrogen hub began last year, backed by $70 million of federal funding. It is also shortlisted for a share of the government’s “hydrogen head-start” funding, which includes a subsidy of $2 per kilogram for producers to help make the clean fuel cost-competitive. The government has also unveiled $6.7 billion in tax credits.
Given the challenges in advancing green hydrogen projects through early stages, BP said support from the government, access to renewable electricity, critical infrastructure and customers would be essential to building up an Australian industry.
Explosives maker Orica partnered with Origin Energy in 2022 to develop the $207 million Hunter Valley hydrogen hub, aiming to make hydrogen to replace feedstock gas in Orica’s Kooragang Island ammonia manufacturing plant.
Intended to launch production in 2026, the hub was among the most advanced hydrogen projects nationally and it had also been shortlisted under the government’s head start scheme, before Origin ultimately deemed it too risky to proceed to a final investment decision.
“It has become clear that the hydrogen market is developing more slowly than anticipated, and there remain risks and both input cost and technology advancements to overcome,” Origin chief Frank Calabria said.
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Orica said it continued to believe in the “significant merit” of the project’s strategic location on the Port of Newcastle with access to an established end-market in its ammonia plant. Chief executive Sanjeev Gandhi said Orica was “open to discussions” with other parties.
Despite Fortescue putting on hold its target of producing 15 million tonnes of green hydrogen by 2030, it says it remains “steadfast” on commercialising the technology. Fortescue now plans to initially focus on four green hydrogen projects in Australia, the United States, Norway and Brazil. Further projects in Morocco, Oman, Egypt and Jordan would follow, the company said.
Energy Minister Chris Bowen said the federal government’s hydrogen incentives would unlock an estimated $50 billion of private investment. More than 50 companies are continuing to progress hydrogen investments in Australia.
“Government support in developing Australia’s hydrogen opportunity provides additional certainty for projects,” Bowen said. “However, how they progress remains a commercial decision for the parties involved.”
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