There’s something of a changing of the guard feeling about the Australian energy sector and those it supplies at present. At the turn of the year, ExxonMobil announced to no one’s great surprise that it was shuttering its Altona refinery to convert it to a products import terminal, leaving the country with just two remaining oil refineries of its own – Ampol’s at Lytton and Viva Energy’s Geelong refinery.
December 21, 2021
The futures of both of those were eventually only secured in May when the government agreed to subsidise their operations and upgrade their plant to produce lower sulphur fuels rather than see them close too due to their struggles to compete.
The loss of the cruise industry to Covid caused a huge knock to sales of both VLSFO and HSFO through 2021 – to the extent that at least one main supplier switched barge coverage to New Zealand instead. With the continued prospect of navigating periodic local lockdowns and a very cautious approach to reopening to foreign tourists, it seems likely that the slump will be a persistent one.
So far, so gloomy. However, the longer-term picture for the Australian fuels market might be rosier – just not in the traditional segments.
Australian mining group Fortescue through its Fortescue Future Industries arm is some way through the planning stages for a 250MW green hydrogen plant in Bell Bay in northern Tasmania and has signed a deal with TasPorts to handle all land and access requirements to the site. The plant could produce 250,000 tonnes per year of green ammonia.
FFI CEO Julie Shuttleworth said: “We are excited to be working with local communities and all stakeholders to develop this important opportunity for the future prosperity of Tasmania and a world that needs to decarbonise. FFI’s Tasmania green hydrogen project could be one of the world’s largest green hydrogen plants when commissioned, creating a significant export market for green hydrogen from Australia.”
“The signing of this agreement with TasPorts marks the beginning of a ground-breaking partnership, aiming for the first export of green hydrogen from an Australian port.”
The company is also keen on developing an ammonia-fuelled bulker for ore shipments from its Pilbara operations in Western Australia. After large-scale engine tests and design work with class society approval in principle, these are now in the closing stages of development, with liquid ammonia chosen specifically over LNG for decarbonisation.
If FFI’s Tasmanian hydrogen plant is to be the first, or the largest, in Australia, it’s going to have to be green-lit quickly. In July, a consortium consisting of InterContinental Energy, CWP Global and Mirning Green Energy announced plans for a mammoth production project dubbed the Western Green Energy Hub, in Western Australia between Esperance and Kalgoorlie-Boulder. The WGEH is earmarked for production of 50GW of solar and wind energy driving the production of up to 3.5 million tonnes of hydrogen or 20 million tonnes of ammonia for use as fuel domestically or for export – a huge amount by any standard.
The consortium will have to be sure of its paperwork, though. A similar mega-project in the Pilbara, Western Australia, the 26GW Asian Renewable Energy Hub, has been forced to resubmit its plans for environmental approval after a switch from exporting electricity to using the power to produce green ammonia.
The switch in purpose and the resultant infrastructure needs – and their effect on wetlands near Eighty-mile Beach – saw the proposals surprisingly knocked back by federal environment minister Sussan Ley. The WA state government, in the form of minister Alannah MacTiernan, pointedly remarked that more controversial coal projects have won approvals in the past. The AREH consortium itself merely said that it would take concerns on board and address them in the future.
Assuming these hurdles can be overcome, it still looks as though hydrogen-based fuel is likely to be a huge part of Australia’s future.
Contact one of the World Bunkering team.
Terms & Conditions | Copyright © 2021 World Bunkering