$70m flows to BP’s WA hydrogen hub as state backs innovation

Brandon How

Global energy giant BP has been awarded $70 million through the federal Regional Hydrogen Hubs program for its H2Kwinana Hydrogen Hub in Western Australia delivering on a commitment made by the former government.

The project initially features a 100MW electrolyser for hydrogen production before potentially expanding to 1.5GW.

A feasibility study for H2Kwinana was completed at the end of August, with two potential daily production capacities identified for the hub, 44 tonnes per day or 143 tonnes per day. It also includes a final growth target for the facility of 429 tonnes per day.

The study was supported by a $300,000 commitment from the Western Australian state government through the second round of funding of the Renewable Hydrogen fund.

BP is now proceeding with a front-end engineering and design study as it prepares for a final investment decision. Site works are already underway with construction expected to be complete by mid-2027.

The project includes development of hydrogen storage, compression and truck loading facilities, and upgrades to an on-site hydrogen pipeline system.

The federal government has committed $526 million to support six hydrogen hubs, including at Port Bonython in South Australia, the Hunter Valley in New South Wales, and on the Central Coast in Queensland.

A Western Australian hydrogen hub in the Pilbara, led by the state government, is awaiting the execution of a $70 million commitment through the same program.

A seventh hydrogen hub at the Port of Newcastle was confirmed to be no longer proceeding at the end of February after Macquarie Capital and its green investment arm withdrew from the project.

Climate Change and Energy minister Chris Bowen said “investing in hydrogen is investing in Australia’s future”.

“Kwinana has been an industrial and economic powerhouse for decades, making it an ideal location for a hydrogen hub that can support decarbonisation of heavy industry and connect our renewable resources to the world,” Mr Bowen said.

“These projects are the next step towards using locally produced renewable hydrogen in Australia to reduce our industrial emissions and develop a renewable export future.

The federal government’s $2 billion Hydrogen Headstart production credit program closed to expressions of interest on November 10, with shortlisted projects to be invited to make full applications in 2024.

Work is still underway to review the national hydrogen strategy in response to the increasing availability of production incentives and other industry development initiatives across the world. A broader policy response to the United States’ Inflation Reduction Act is expected soon.

The federal announcement coincides with the opening of a $60 million round of its Investment Attraction Fund targeting ‘New Energies Industries’. Premier \Roger Cook told a WA Energy Transition Summit on Friday that the new round was “backing the spirit of innovation in Western Australia”.

The New Energies Industries round of the IAF focuses on supporting “projects in battery and critical minerals processing, renewable hydrogen, advanced manufacturing in wind and solar componentry, along with carbon capture use and storage projects” according to the WA state government.

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