Fortescue Future Industries has reached an agreement with TasPorts giving it the option of leasing a 20-hectare piece of land at Bell Bay for the construction of a nation-first 250-megawatt green hydrogen and green ammonia production facility.
They will announce the option agreement on Tuesday, with FFI planning to make a final investment decision by the end of 2021 should it reach agreements with Hydro Tasmania and TasWater for water resources, and TasNetworks for access to renewable energy.
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If approved, construction was planned to start next year with production from the second half of 2023.
It was the first of four potential green hydrogen production facilities to reach this stage at Bell Bay, with FFI to focus on the production of about 250,000 tonnes of green ammonia per year to assist agricultural sectors to de-carbonise.
Green hydrogen production could occur following future stages, with a goal of 15 million tonnes per year by 2030. The facility could expand to 2000-megawatt, depending on additional renewable energy sources being established in Tasmania.
The option agreement with TasPorts lasts until March next year, but can be extended, prior to a development agreement being reached and final approvals achieved.
FFI chief executive officer Julie Shuttleworth AM said it was the most advanced proposal of its kind in Australia.
That will make it the very first green hydrogen export project in Australia, and in fact the largest in the world of its kind, is what we're expecting.Julie Shuttleworth
FFI has been in discussions with export markets in Japan and South Korea, however Ms Shuttleworth said there was also interest domestically.
"Our design will have off-take points of hydrogen and ammonia to be able to provide the domestic supply chain in Tasmania and we've already received a lot of interest from domestic companies to supply either green hydrogen or green ammonia to them," she said.
The 250-megawatt facility would require between two and 2.6 gigalitres of water to meet its expected production targets. The nearby Curries River Reservoir hold about 12 gigalitres.
FFI had not yet reached a final agreement on sourcing this water, but the company believed there were a range of options available via Hydro, and through its own ability to treat raw water supply.
FFI will carry out an expressions of interest process for prospective employees in nearby communities later this year, with a construction and trades workforce required initially, and logistics, accounting, electrical, mechanical and automation skills longer term.
It could also provide skills training opportunities.
TasPorts confident of green hydrogen potential for Bell Bay
TasPorts remained in discussions with several other proponents interested in establishing green hydrogen productions facilities at Bell Bay, believing there was ample room for significant development.
Chief executive officer Anthony Donald said the industry was a key part of the future of the Bell Bay industrial precinct.
"This is clearly the first significant announcement, and we're very optimistic there'll be a series of announcements over the coming months," he said.
"We do have a significant land offering, and equally there are other land holdings adjacent to our land offerings, which means that there is ample opportunity for multiple proponents here."
The race to establish hydrogen production industries across Australia has developed rapidly in recent years, but Mr Donald said Bell Bay had a competitive advantage with access to shared port infrastructure, potable water and renewable energy resources.
"The announcement today with Fortescue is a significant announcement for George Town, for the Port of Bell Bay, for Tasmania, this is a nationally-significant announcement," he said.
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