Energy major bp will acquire a 40.5% stake in and become operator of a green hydrogen project in Western Australia that could feature up to 26GW of solar and wind when complete.
Due to be developed in multiple phases, the Asian Renewable Energy Hub (AREH) intends to supply renewable power to local customers and also produce green hydrogen and green ammonia for both domestic and export markets.
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At full capacity, AREH is expected to be capable of producing around 1.6 million tonnes of green hydrogen or 9 million tonnes of green ammonia per year.
BP believes AREH “can be a cornerstone project” in helping its customers meet their net zero and energy commitments, said Anja-Isabel Dotzenrath, the company’s executive vice president of gas and low carbon energy.
“It truly reflects what integrated energy is – combining solar and onshore wind power with hydrogen production and using it to help transform sectors and regions. It also reflects our belief that Australia has the potential to be a powerhouse in the global energy transition, benefitting from both its existing infrastructure and abundant renewable energy resources.”
Situated on a 6,500-square-kilometre site in the Pilbara region, AREH is in an advantaged position with access to abundant solar and wind resources with consistent output, according to bp.
Under terms of the agreement, bp will acquire a 40.5% interest in the project and will assume operatorship from 1 July 2022. The other partner shareholders in AREH will continue to be InterContinental Energy (26.4%), CWP Global (17.8%) and Macquarie Capital and Macquarie’s Green Investment Group (15.3%).
First proposed in 2014, AREH secured environmental approval for the first 15GW stage of the hub from Western Australia’s government in 2020, but the development hit a snag last year when the federal government blocked the project, citing its environmental impact. Former environment minister, Sussan Ley, said at the time that the hub “will have clearly unacceptable impacts” on wetlands and migratory bird species.
Western Australia’s Environmental Protection Authority had previously given environmental approval for AREH provided the project meets conditions such as creating no-impact buffer zones and burying transmission lines to help preserve biodiversity.
Frédéric Baudry, president at bp Australia, said the company will contribute to the project by bringing its experience in constructing and operating facilities in remote locations and leveraging its shipping and trading businesses.
Other proposed green hydrogen developments in Western Australia include the Murchison Renewable Hydrogen Project, which would feature up to 5GW of solar and wind, and the Total Eren-backed HyEnergy Project.
