Henergy Technologies proposes $40 million takeover of Katnook Gas field for hydrogen storage

A controversial gas field is key to the nation’s hydrogen revolution according a Adelaide start-up, but a lobby group has hit out at the plan, saying it’s not green enough.

The South East’s depleted gas wells are key to Australia’s hydrogen revolution, according to a plan to bring world leading technology to South Australia.

Adelaide-based Henergy Technologies has revealed a $40m idea that would see reservoirs near Penola repurposed to store hydrogen and the construction of an electrolysis plant.

Engineering manager Peter Archer said the Katnook gas field, where operations are to be suspended later this year, was critical in unlocking green hydrogen potential and would create around 200 jobs.

“There’s an opportunity to store hydrogen in a unique way,” Mr Archer said.

Peter Archer, Henergy Technologies engineering manager. Picture: Jessica Ball

“There’s not too many people who have taken a step further from research to the testing phase so we’re going be world leading.”

The start-up hopes to secure $9m in state and $20m in federal government funding alongside investment from local forestry, dairy and trucking industries to reach its 2024 target, citing Scott’s Transport, Union Dairy Company, OneFortyOne and Timberlink as potential partners.

The plan hinges on securing a petroleum production and gas storage licence currently held by Beach Energy which Mr Archer said was “very likely”, before it purchasing equipment and drilling a well.

“We have to work really hard in the next six months to get those permits and once we’ve got access we can start to prepare our own dedicated hydrogen well probably very late 2022,” he said.

“Our target right now is to be ready to electrolysis water and generate hydrogen for underground storage in the second quarter of 2024.

“The ultimate prize is to slowly blend greater and greater proportions of hydrogen into the natural gas system that makes it greener and greener.”

The plan would initially create “blue energy” working in combination with natural gas to feed the nearby Origin peak power station before going green in the 2030s.

Henergy’s plan also includes a hydrogen fuel station next to the Riddock Highway plant and carbon capture storage selling food grade carbon dioxide while in the 2050s it hopes to explore ammonia energy storage, fertiliser production and the building of a port at Beachport for ammonia export.

“There is great interest now in Australia to further develop fuel cell electric vehicles and fuel cells can run on hydrogen,” Mr Archer said.

“Australia’s primarily focused on larger vehicles trucks and buses.”

Limestone Coast Protection Alliance co-chair Angus Ralton has been a vocal opponent of Beach Energy’s operations at the Katnook site and said while it supported renewables, Henery’s proposal had “serious flaws”.

“It’s a ridiculous idea,” Mr Ralton said.

Limestone Coast Protection Alliance co-chair Angus Ralton. Picture: AAP Image/ Kelly Barnes

“The fact that it’s going to be blue hydrogen for 10 years before it becomes green hydrogen, not good enough, absolutely nowhere near good enough, we need green hydrogen and nothing else.

“All there is in this proposal is whole lot of risk for South Australian taxpayers.”

While the project suggests it would use one to three buckets of water for each Olympic swimming pool used by the agricultural industry, Mr Ralton said there was nothing left to give.

He also said Henergy’s proposal for purifying the water and injecting the leftover brine into the earth had been responsible for earthquakes in the US.

“The water is already over allocated, there’s no more left to give and who’s going to miss out if this goes ahead,” he said.

“Reinjection of liquid into the geology of the South East has already been proved to be impossible.”

Instead he said it was crucial Beach Energy was responsible for the decommissioning, rehabilitation, monitoring of the wells, “to make sure the Limestone Coast is safe from the reckless actions of the fossil fuel companies”.