Woodside Petroleum plans ammonia and hydrogen plant in Perth

Woodside Petroleum has announced plans to enter the ammonia industry, agreeing to acquire land south of Perth to build a huge export plant for ammonia and ­hydrogen.

Meg O’Neill says the project will be a ‘landmark’ for Woodside as it looks for growth beyond its oil and gas business. Picture: NCA NewsWire

Woodside Petroleum has announced plans to enter the ammonia industry, agreeing to acquire land south of Perth to build a huge export plant that would produce ammonia and ­hydrogen.

While Woodside said on Monday it would design the plant to be a net-zero carbon dioxide emitter, and would eventually produce at least some of its hydrogen from water, figures released by the company suggest about two-thirds of its output would come from the use of natural gas to produce ammonia.

Woodside said the initial phase of the plant would use 40 terajoules of natural gas a day, enough to produce about 1100 tonnes of ammonia, or 400,000 tonnes a year. In total, the plant would be designed to produce about 600,000 tonnes of ammonia a year.

The electrolysis component of the project, dubbed H2Perth, will have an initial capacity of 250MW, with potential to scale to more than 3GW if customer demand and the capacity of the West Australian power grid allow.

Announcing the project, which Woodside said it expected to be under construction by 2024, chief executive Meg O’Neill said the facility would be a “landmark” for the company as it looked for growth beyond its traditional oil and gas business.

“Woodside has a proud track record as an Australian oil and gas producer and our LNG exports will continue helping Asia to reliably meet its energy needs while reducing greenhouse gas emissions for decades to come,” Ms O’Neill said. “Now we intend to use our skills and financial strength to add new energy products and lower-carbon technologies and services to our portfolio, which can be scaled to meet customer demand.”

Woodside said a 3GW electrolysis plant could also act as a demand-side “battery” for the electricity grid in the South West of WA – which currently has a ­capacity of only 5.8GW.

“H2Perth will also facilitate substantial growth of renewables in Western Australia by providing to the grid a flexible and stabilising load that benefits uptake of intermittent renewable electricity by households and local industry,” Ms O’Neill said.

Woodside did not put a likely capital cost on the project, and said a final investment decision depended on commercial via­bility and regulatory approvals.

Woodside shares closed up 86c at $24.13 on Monday.