Tender out to truck natural gas to Upper Spencer Gulf’s $593m hydrogen plant
As the entire state cabinet meets in Whyalla, a new tender reveals the city doesn’t have enough gas to get the state’s hydrogen plant up and running, sparking fears of cost blowouts.
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Natural gas will have to be trucked to the state government’s $600m hydrogen plant site for up to two years, fuelling opposition claims its green credentials are a hoax.
A tender released by the Office of Hydrogen Power SA shows the government needs what it calls a “virtual pipeline” to deliver gas to the Upper Spencer Gulf project site.
Opposition energy spokesman Stephen Patterson feared there would be cost blowouts for the $593m project as a result.
Mr Patterson called that “window dressing for what the reality is – diesel powered B-double road trains”.
As the entire state cabinet travelled to Whyalla on Monday, Mr Patterson said he wanted to know why the hydrogen power office was only now saying publicly that the existing Whyalla natural gas pipeline could not provide enough natural gas to get the project up and running. The tender said the natural gas or biomethane gas supply was needed for “commissioning, start-up gas, shutdown-gas, and back-up gas”.
The government wants an operator to design a “mother site” near a guaranteed supply of natural gas where trucks can be fuelled to make daily deliveries to the project site.
Mr Patterson was concerned this would amount to numerous truck journeys a day.
There also would need to be a “daughter site” designed and built where trucks can unload the gas near the hydrogen power station along with a storage facility that can store enough to “enable four hours running of 200MW turbines”.
“(Energy Minister) Tom Koutsantonis has tried to claim that gas will only be required to start the turbines. However, now it has been revealed that they will need to run on gas for up to four hours a day,” Mr Patterson said.
“Labor wanted South Australians to believe that it would be fully powered by green hydrogen produced on-site.
“The trucking in of gas to run the turbines is required because of a lack of foresight in relation to gas pipelines, with the Whyalla gas pipeline already at capacity and unable to provide gas to Labor’s expensive hydrogen plant.”
He also raised concerns about whether the significant increase in the price of electrolysers since Labor announced its green hydrogen policy in 2021 would blow out project costs further.
The preferred project partners appointed in October last year, ATCO Australia and BOC Linde Consortium, found that the Whyalla gas pipeline could not meet natural gas needs.
“As we are currently out to market, we are not in a position to confirm costs, however this is factored into the overall costs of the project,” a government spokesman said.
“We have said many times that the new 200MW gas turbines will require a short-term natural gas/biomethane gas supply for commissioning, start-up gas, shutdown-gas, and back-up gas.
“We have reiterated often that gas is a crucial component of South Australia’s energy transition.”
The spokesman also said that AEMO’s recent energy reliability report showed that the generator being built as part of the Hydrogen Jobs Plan was critical to safeguarding energy supply in the state and required to support South Australia’s electricity grid.
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Originally published as Tender out to truck natural gas to Upper Spencer Gulf’s $593m hydrogen plant
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