Green hydrogen developer Fortescue Future Industries (FFI) has invested €30mn ($29mn) to become a shareholder in energy infrastructure developer Tree Energy Solutions (TES) and will invest €100mn in the construction of the TES terminal in Wilhelmshaven in Germany, taking a 30pc stake in the subsidiary building the terminal.

The German Federal Ministry for Economic Affairs and Climate Action recently selected TES to jointly develop and implement the country’s fifth LNG floating storage and regasification unit (FSRU) in Wilhelmshaven. Berlin and the consortium expect the FSRU to start operations before the end of 2023.

The FSRU will also facilitate green hydrogen imports, and FFI and TES have agreed as part of the deal to jointly develop and invest in the supply of 300,000t/yr of the fuel.

“The UK and Europe urgently need green solutions to replace fossil fuels” Forrest, FFI

Initial collaboration projects will be focused on Australia, Europe, the Middle East and Africa, with first delivery of green hydrogen expected in 2026.

The terminal would import hydrogen molecules in the form of green methane—which can be produced from CO₂ combined with hydrogen made using renewable power. The methane will be converted back into hydrogen after it is imported, with the CO₂ captured and transported back to the supply location—making it effectively a carrier in a closed loop system.

“The UK and Europe urgently need green solutions to replace fossil fuels, and this investment will enable Europe to do exactly that. Not in 2050, but in four years from now,” says Andrew Forrest, executive chairman of FFI parent company Fortescue.

Meeting import targets

The investment will enable FFI to partially fulfil an agreement signed with German energy distributor Eon earlier this year to provide Germany with 5mn t/yr of green hydrogen, with supply commencing mid-decade.

The investment will be funded by FFI’s unutilised capital of $1.1bn.

FFI joins a group of investors in TES that include Eon as well as banks HSBC and Unicredit, and ship management company Zodiac Maritime.

FFI is the green energy subsidiary of Australian iron ore miner Fortescue Metals Group, which has earmarked 10pc of net profits for the unit to explore green hydrogen projects in Australia, Argentina, Jordan and Papua New Guinea. FFI’s ambition is to grow its green hydrogen production to 15mn t/yr by 2030 and 50mn t/yr by 2040.

Developing strategy

Germany's national hydrogen strategy set an import target of 76-96TWh for 2030. The German government has launched the H2Global initiative for green hydrogen imports, a €2bn strategy to support electrolyser projects abroad.

Germany is also in talks with Norway over the possibility of importing large volumes of hydrogen, potentially via a pipeline, as it ramps up efforts to reduce its dependence on Russian fossil fuels following the invasion of Ukraine.

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Author: Tom Young