Japanese trading giant Itochu joins $1bn Australian hydrogen project
Australia’s leading clean hydrogen project at Gladstone that comes with 1000 construction jobs is one step closer with a major partnership deal struck.
Japanese trading giant Itochu Corp has announced a partnership with Australia’s leading clean hydrogen project as the Asian country seeks to wean itself off fossil fuels.
Itochu has signed a memorandum of understanding with Australian Future Energy (AFE), which is developing the $1bn Gladstone Energy and Ammonia Project (GEAP).
AFE chief executive Kerry Parker said the partnership with Itochu demonstrated the long-term viability and profitability of the project.
Using both blue and green hydrogen, the project will produce ammonia, synthetic natural gas and ultimately electrical power using a gasification process.
Blue hydrogen is extracted from coal or gas, while green hydrogen is manufactured from renewable energy sources such as solar, wind or tidal power.
Mr Parker said the aim was to take on Itochu as an equity partner in the project, which is located in the Gladstone state development area, northwest of the industrial city.
Mr Parker said Asian economies such as Japan and Korean were leading the interest in hydrogen as the energy mix changes around the world.
“The announcement takes us a step closer to delivering long-term job opportunities for central Queensland through the delivery of low-carbon energy alternatives,” said Mr Parker.
“It also will enable smaller scale green energy hydrogen projects being proposed at present around the Gladstone region.”
It is estimated the plant will create up to 200 jobs during its 30-year life and 1000 jobs during the construction phase.
The project, which has been listed by the Queensland government as a “project of significance”, could be operational as soon as 2024.
Mr Parker said hydrogen at the Gladstone project would be extracted from coal with about 230,000 tonnes of ammonia and 14 petajoules of gas also to be produced.
Commonly used as a raw material in fertilisers and explosives, ammonia is also a rich source of hydrogen to power electric vehicles.
Off-take arrangements are in place for all output from the plant, including carbon dioxide, which will be processed and captured.
He said the gasification process to be used was the first of its type in Queensland and only one of a handful in the world.
The agreement comes amid growing interest from major Asian nations such as Japan and Korea as they seek renewable energy sources to power their economies.
“We have had discussions with other Japanese trading houses who are exploring hydrogen development,” Mr Parker said.
Japan’s new ambassador to Australia, Shingo Yamagami, said earlier this year that hydrogen shipments from Australia to Japan could eventually rival the post-war boom in coal trade between the two countries.
Mr Yamagami said Australia was set to become a major source of hydrogen for Japan as it moved to a carbon-neutral economy by 2050.
“All the big trading houses in Japan are interested in developing hydrogen,” he said. “Australia is well placed as a source of hydrogen because of its long-tradition of shipping energy and raw minerals to Japan.”
Japan’s move to shore up Australia as a secure source of renewable energy comes amid warnings from Mr Yamagami about the threats posed by an increasingly “assertive” China in the Asia Pacific.
Japan’s energy supply has become less certain following the 2011 Fukushima nuclear disaster that made it more reliant on imports of fossil fuels such as oil, gas and coal.
Earlier this year, Itochu announced a partnership with French industrial gas supplier Air Liquide to develop a liquid hydrogen plant in central Japan.
