By Peter Roberts
Fortescue plans to make a final investment decision in December on its ambitious plans for large scale hydrogen electrolysers to be sited at Incitec Pivot’s Gibson Island plant in Brisbane.
The company issued a statement that US supplier Plug Power was preferred supplier for the proposed 550 MW (megawatt) PEM (proton-exchange membrane) electrolyser supply contract which is subject to final negotiations and approvals and Fortescue’s final investment decision (FID).
An FID is expected by the end of December 2023.
Once operational the plant is expected to produce approximately 385,000 metric tonnes of green ammonia a year from the green hydrogen produced onsite through the 550MW hydrogen electrolysis facility.
However it is unclear whether the electrolysers will be sourced from the manufacturing facility being constructed by Fortescue in Gladstone, Queensland, or from electrolyser partner Plug’s US operations.
In 2021 the two companies signed a letter of intent to create a 50-50 joint venture to build the ‘Gigafactory’ in Queensland, aiming to produce two gigawatts a year of hydrogen electrolysers.
However Fortescue’s statement was opaque as to sourcing for Gibson island, part of which has been mothballed because of Incitec Pivot’s inability to secure a fair priced contract for a supply of natural gas.
CEO, Fortescue Energy Mark Hutchinson said: “Plug Power’s preferred supplier status for the Gibson Island Project is another step towards fulfilling our ambition to make a final investment decision on the that project this calendar year.
“It is vital that first movers like Plug Power and Fortescue continue to work together to develop and scale-up the green energy and green hydrogen industries in Australia and North America.
“We believe there is strong demand globally for the green hydrogen we will produce and we must move quickly to meet that demand.”
Plug CEO Andy Marsh said: “The proposed 550MW electrolyser deal reinforces Plug’s established leadership position in deploying electrolyser solutions at a global scale.
“Today, we have taken a meaningful positive step forward in our ongoing relationship with Fortescue, opening up many opportunities to build the green hydrogen economy together in the future.”
Sanjay Shrestha, General Manager, Energy Solutions & Chief Strategy Officer continues, “Fortescue’s interest in investing in our green hydrogen plants validates Plug’s strategy to bring on third party investors, and its economic attractiveness as we execute our capital investment strategy for our green hydrogen plant network by bringing on board partners and outside investors.”
Fortescue and Plug also signed a Memorandum of Understanding (MOU) to evaluate the potential supply of a range of capital equipment including electrolysers, liquefiers, tanker trailers and stationary storage tanks for green hydrogen production projects in North America.
This includes for Fortescue’s proposed Phoenix hydrogen plant and both parties are also looking to collaborate on additional large projects on a global basis.
Under the terms of the MOU, Plug and Fortescue will also evaluate co-investment opportunities in green hydrogen production projects in North America.
Plug and Fortescue have started the initial diligence process for Fortescue to take up to a 40 percent equity stake in Plug’s Texas hydrogen plant (45 MTPD) and for Plug to take up to a 25 percent equity stake in Fortescue’s proposed Phoenix hydrogen plant.
Fortescue and Incitec Pivot strike green gold at Gibson Island
Browse @AuManufacturing’s coverage of Fortescue here.
Picture: Plug Power