PERTH (miningweekly.com) – The Australian Renewable Energy Agency (Arena) has awarded A$13.7-million in funding to green energy developer Fortescue Future Industries (FFI) and its partner Incitec Pivot (IPL) to fund a front-end engineering design (FEED) study for the development of a large-scale renewable hydrogen production facility and conversion of IPL’s existing Gibson Island ammonia plant to use renewable hydrogen produced by the hydrogen facility.
IPL’s Gibson Island facility will cease traditional fertiliser manufacturing early in the new year. As part of IPL’s decarbonisation strategy and in line with FFI’s goals to help heavy industry decarbonise, the Brisbane ammonia manufacturing and port facility conversion would be a world-first.
The A$38-million project would be looking to investigate the deployment of a 500 MW electrolyser, capable of producing up to 70 000 t/y of renewable hydrogen.
By virtue of running on green hydrogen, the facility could ultimately produce up to 400 000 t/y green ammonia, which can be exported to international markets as well as used in fertiliser or to help decarbonise local industry through its potential use as a low-carbon fuel source for ports, airports and heavy transport.
FFI said on Friday that the FEED was a critical phase in development and would firm up technical specifications and cost, underpin procurement, as well as mature the project to final investment decision (FID), targeted for 2023.
FFI CEO Mark Hutchison said around 100 jobs would be supported across the project in the lead up to FID, with first production, subject to FID, expected around 2025.
“Progressing this project into this final assessment stage is an important milestone in what will be a world-first conversion of an existing facility to become an industrial-scale producer of green hydrogen and green ammonia,” Hutchinson said.
“This collaboration aims to put Queensland and Australia ahead of the pack – not only in terms of the scale of production and supply of green hydrogen and green ammonia, but also in terms of demonstrating to the world that projects like this are feasible and that Australia has the foresight, the commitment, and the know-how to invest in and deliver them.”
Minister for Climate Change and Energy Chris Bowen said the project would help Australia become a world leader in hydrogen production.
“The project will provide valuable insights into the cost of producing renewable hydrogen and adapting infrastructure to facilitate exports of renewable ammonia,” Bowen said.
“If successful, the electrolyser will be the largest built to date, feeding renewable hydrogen directly into the first fully decarbonised ammonia facility. The study is critical to the domestic and export industry for clean hydrogen and ammonia supply chains to deliver Australia’s first renewable hydrogen shipments to international markets.”
Arena said on Friday that the study would generate important learnings for the industry, developing benchmarks for the economics of large scale renewable hydrogen and ammonia production in Australia, improving the understanding of the technical and commercial feasibility of large scale electrolyser deployments. The study would also provide insights into the feasibility of converting existing ammonia production facilities to use renewable hydrogen, and help to further understand the market for renewable ammonia in Australia and internationally.
Arena CEO Darren Miller said the project would significantly accelerate the development of a renewable ammonia industry in Australia.
“This is an exciting project for the parties involved and for Australia. Having the ability to reutilise ageing assets and repurposing them to use renewable energy will not only help to keep costs down in the future, but also ensure skilled workers are retained as we continue our transition to net zero emissions,” Miller said.
“Having been involved in the development of Australia’s earliest renewable hydrogen projects, large industrial players are now seeing the potential benefits of hydrogen and looking to build even larger projects. Ultimately, our goal is to reduce the cost of producing hydrogen at scale so it can outcompete hydrogen made with fossil fuels. If we can improve the economics of renewable hydrogen, we can realise our collective vision of decarbonising hard-to-abate sectors and establishing significant new export markets,” he said.
Ammonia production is a highly energy-intensive process, producing about 500-million tonnes annually of carbon dioxide as a result, which is around 1.8% of global carbon emissions, similar in scale to the aviation industry. Ammonia is used in agriculture and industry, with up to 80% of ammonia used to make fertiliser, and the remaining 20% used for industrial purposes such as manufacturing explosives and plastics.
Arena recently announced A$47.5-million in conditional funding to ENGIE to build a 10 MW electrolyser which will produce renewable hydrogen to be fed into Yara Pilbara Fertilisers ammonia facility in Karratha, in Western Australia, and previously committed A$88-million to renewable hydrogen projects spanning feasibility studies, small scale electrolyser demonstrations, gas blending trials and vehicle deployments.