The ARENA-backed project at Kooragang Island in New South Wales will deploy 50 MW of electrolyzer capacity powered by renewable energy and use recycled water and renewable electricity to produce renewable hydrogen for ammonia production. The facility is expected to produce about 4,700 tonnes per annum of renewable hydrogen, sufficient to produce approximately 26,600 tonnes per annum of low-carbon ammonia.

The hydrogen will replace gas feedstock in ammonia production at Orica’s existing facility, reducing the company’s natural gas feedstock demand by approximately 7.5%. The project was selected under Round 1 of the Hydrogen Headstart program and is set to receive $432 million in funding.

Specialized contractors will construct the facility using well-established technology deployed at scale internationally. Construction is scheduled to commence in 2026, with first production targeted for early 2029.

Capital expenditure related to construction is expected to be in the range of $245 million to $283 million across 2026 to 2029, net of government capital funding. Net capital expenditure in 2026 is expected to be $25 million to $37 million, incremental to Orica’s existing business capital expenditure, which is expected to be broadly in line with 2025.

The Australian Renewable Energy Agency (ARENA) said Orica’s decision marked a critical step for large-scale hydrogen projects in Australia.

Darren Miller, Chief Executive Officer of ARENA, said: “This milestone is an important step in demonstrating industry commitment to renewable hydrogen, particularly as a pathway to decarbonise heavy industry and reduce emissions where alternatives are limited.”

“Hydrogen is a complex, capital-intensive industry, but it represents a significant economic and decarbonisation opportunity for Australia,” said Miller.

“This decision signals that renewable hydrogen production can be deployed at scale in Australia, shifting the conversation from concept to deployment, particularly for hard-to-abate sectors where it can make the biggest impact,” added Miller.

Source:   Hydrogentechworld