Incitec, Fortescue take next steps in Queensland hydrogen
But Fortescue Future Industries has been hit by more executive departures as it announces progress in its first operations with Incitec Pivot.
Andrew Forrest’s green energy arm has been hit by more executive departures as it announces it is pressing ahead with work on its first hydrogen production plant with Incitec Pivot.
The Weekend Australian understands Fortescue Future Industries head of projects development, Gordon Cowe, has recently handed in his notice at the company, along with another senior member of his team.
FFI has also lost another senior member of its US operations only a month after the departure of its local chief executive Paul Browning, with FFI’s US head of green hydrogen and ammonia marketing quitting to take up a role at an ammonia producer.
A spokeswoman for FFI declined to comment, despite the company last month confirming the departure of the boss of its US operations in response to a query from The Australian. “We respect the privacy of all our employees at all times,” she said.
The departures come as FFI and Incitec announced they would press ahead with the front end engineering and design on their joint project to develop a green hydrogen plant at Incitec’s Gibson Island fertiliser plant in Brisbane, saying a study conducted over the last year had confirmed the project is “feasible”.
Taxpayers will chip in more than a third of the $38m cost of the FEED study, with the federal government’s Australian Renewable Energy Agency committing $13.7m to back the work.
The two companies did not disclose the likely capital cost of repurposing the ageing manufacturing facility, nor give any details of the likely production costs of green ammonia other than to say previous studies had “confirmed its feasibility”.
FFI and Incitec both declined to give details of the results of the feasibility study on Friday, with a spokeswoman for FFI saying the numbers will be made available to shareholders if and when a final investment decision is made on the project in 2023. But the companies said the project will see a 500 megawatt hydrogen electrolysis facility built on Gibson Island after Incitec winds down its existing manufacturing facility on the site this year.
Incitec’s existing fertiliser plant will be converted to allow the use of hydrogen rather than methane gas, with the output from the plant about 400,000 tonnes of ammonia a year. If a final go-ahead is given, first production would come in 2025.
The size of the electrolyser suggests the companies would need about 1.5GW in firmed renewable energy to run the plant, with industry sources noting contracts having been offered at around $70 a megawatt hour.
FFI said it was working with Queensland’s transmission network Powerlink to connect Gibson Island to the grid, and was looking for a provider of the fresh water that would also be needed to sustain hydrogen production. “A domestic and international process is underway to canvas potential buyers of the green ammonia that will be produced by the facility,” FFI said in a statement. Fortescue shares closed down 29c to $17.31 on Friday, with Incitec off 6c to $3.63.
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