PERTH (miningweekly.com) – Energy major BP will acquire a 40.5% equity stake, and become operator of the Asian Renewable Energy Hub (AREH), in Western Australia, which has the potential to be one of the largest renewables and green hydrogen hubs in the world. 

AREH, in the Pilbara, intends to supply renewable power to local customers in the largest mining region in the world and also produce green hydrogen and green ammonia for the domestic Australian market and export to major international users.

AREH has plans to develop onshore wind and solar power generation in multiple phases to a total generating capacity of up to 26 GW, the equivalent of producing over 90 terawatt hours per year, which is around a third of all electricity generated in Australia in 2020. 

At full capacity, AREH is expected to be capable of producing around 1.6-million tonnes of green hydrogen or 9-million tonnes of green ammonia, a year.

“AREH is set to be one of the largest renewable and green hydrogen energy hubs in the world and can make a significant contribution to Australia and the wider Asia Pacific region’s energy transition. It truly reflects what integrated energy is, combining solar and onshore wind power with hydrogen production and using it to help transform sectors and regions. It also reflects our belief that Australia has the potential to be a powerhouse in the global energy transition, benefitting from both its existing infrastructure and abundant renewable energy resources,” said BP executive VP of gas and low carbon energy Anja-Isabel Dotzenrath.

“We believe AREH can be a cornerstone project for us in helping our local and global customers and partners in meeting their net-zero and energy commitments. It will also serve as a long-term clean energy security contributor in Asia Pacific, helping countries such as South Korea and Japan to decarbonise.” 

When fully developed, AREH could provide significant net renewable generating capacity for BP as well as make a material contribution to its strategic aim to capture a 10% share in core hydrogen markets globally.

BP Australia president Frédéric Baudry said the company was looking forward to working closely with partners InterContinental Energy, CWP Global, Macquarie Capital and Macquarie’s Green Investment Group, as well as the Nyangumarta people.

“BP brings a broad range of capabilities to help bring the project to fruition, with extensive experience in constructing and operating facilities of this scale in remote locations in close collaboration with local communities, and leveraging our global shipping and trading businesses. We also have the benefit of deep experience in working with customers looking for decarbonisation solutions and delivering low-carbon energy to the global market.”

Situated on a 6 500-km² site, AREH is already in a highly advantaged position with access to abundant solar and wind resources with consistent output. 

At full capacity, AREH is expected to abate around 17-million tonnes of carbon in domestic and export markets annually, which would equate to roughly 0.5 gigatonnes of carbon savings over the lifetime of the project.

The Western Australian government on Wednesday welcomed BP’s investment into the AREH project, with Hydrogen Industry Minister Alannah MacTiernan saying it was another major step forward for the globally significant project.

“BP's commitment to the AREH is a significant vote of confidence for the next stage of development of the Western Australian renewable hydrogen industry.

“The project will transform the Pilbara, create thousands of jobs and be a major contributor to global efforts to decarbonise the economy, and provide the low-cost energy to underpin downstream processing of our mineral wealth,” said MacTiernan.

“A project of this scale will require new supply chain facilities for the manufacture and assembly of equipment for wind, solar and hydrogen generation, which will create new, local, high-value jobs.

“Today's announcement reinforces Western Australia's credentials as a world-class investment destination for green energy generation, including the production of exportable commodities, like green hydrogen and ammonia and green steel.”