BP has acquired a 40.5pc equity stake in and become operator of the Asian Renewable Energy Hub (AREH)—a planned 26GW onshore wind and solar project in Australia that will also produce green hydrogen.

AREH, in the Pilbara region of Western Australia (WA), was first proposed in 2014 and developed by green hydrogen firm Intercontinental Energy, renewables developer CWP Global and financial services firm Macquarie Capital, which will retain a 26.4pc, 17.7pc and 15.3pc share in the project respectively. Danish wind firm Vestas has sold its stake.

The project intends to supply renewable power to local mining firms and produce either 1.6mn t/yr of green hydrogen or 9mn t/yr of green ammonia from 14GW of electrolysers for the Australian market and export to major international users from the deepwater ports of Dampier and Port Hedland.

The project already has planning consent for 15GW of wind and solar capacity, and the developers hope to make FID in 2025.

“AREH is set to be one of the largest renewable and green hydrogen energy hubs in the world,” says Anja-Isabel Dotzenrath, BP’s executive vice-president of gas and low-carbon energy.

“It will also serve as a long-term clean energy security contributor in Asia Pacific, helping countries such as South Korea and Japan to decarbonise.”

“AREH is set to be one of the largest renewable and green hydrogen energy hubs in the world” Dotzenrath, BP

The project was given fast-track status by the federal Australian government last year and has received some state environmental approvals. Fast-track status gives projects a single-entry point for state and federal government approvals and project support.

AREH is expected to support more than 20,000 direct and indirect jobs during construction over ten years and 3,000 jobs when fully operating. 

“This transaction marks an important step in our journey to create the necessary global partnerships to realise the full potential of the Intercontinental Energy portfolio of projects—producing 10mn t/yr of green hydrogen,” the firm says.

Capturing the market

Elsewhere in Australia, BP has conducted a feasibility study into green hydrogen production at its recently closed Kwinana refinery and is developing a pilot plant to produce 4,000t/yr of hydrogen and up to 20,000t/yr of ammonia near the WA port of Geraldton.

BP’s scenarios show a fourfold increase in clean hydrogen demand by 2050. Hydrogen-based synthetic fuels and direct use of hydrogen account for around 5-15pc of total final energy use by 2050 under the firm’s forecast scenarios.

BP has a goal to capture 10pc of the low-carbon hydrogen market in key geographies by 2030.

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Author: Tom Young