June 05, 2023 • Paul Rodden • Season: 2023 • Episode: 220
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In episode 220, Two new projects in Australia continue to move forward with the help of Singapore. And salt dome storage in the western part of the US for hydrogen is getting developed all of this on today's hydrogen podcast.
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Two new projects in Australia continue to move forward with the help of Singapore. And salt dome storage in the western part of the US for hydrogen is getting developed all of this on today's hydrogen podcast.
So the big questions in the energy industry today are, how is hydrogen the primary driving force behind the evolution of energy? Where's capital being deployed for hydrogen projects globally? And where are the best investment opportunities for early adopters who recognize the importance of hydrogen? I will address the critical issues and give you the information you need to deploy capital. Those are the questions that will unlock the potential of hydrogen, and this podcast will give you the answers. My name is Paul Rodden, and welcome to the hydrogen podcast.
In an article in power technology.com, Alex Donaldson writes Singapore's Keppel enters into two Australian hydrogen projects. The deals we'll see Keppel participate in Queensland's CQH2 hydrogen project and a further green ammonia export facility in the same region. Singapore infrastructure conglomerate Keppel has announced its participation in two Australian green hydrogen and ammonia ventures. Keppel has joined the CQH2 Hydrogen project consortium to develop green hydrogen in Queensland, Australia. The project will see 640 megawatts of electrolytic capacity constructed to produce hydrogen for industrial activities. The consortium expects to begin hydrogen production operations in 2028, initially producing 200 tons per day, with a number of scale ups to target 800 tons per day, and 2031 Keppel also signed a memorandum of understanding with chemical company Incitec Pivot or IPL to build a green ammonia project in Queensland. The ammonia produced will be used in Australia and exported across Asia.
The project will utilize hydrogen from the CQ h2 project for its output. An initial MOU was signed between the two companies in 2021 to conduct a feasibility study for the project now we did cover that on this podcast when it was announced in 2021. And it's good to see that more momentum has built on this project. The combined ammonia production and export facility will produce 850,000 tons of ammonia per year. The Chemical Company is the largest supplier of fertilizer, of which ammonia can be a key component in the east of Australia. Keppel infrastructure division CEO Cindy Lim stated through Keppel 's involvement in the CQ h2 consortium and their partnership with Incitec Pivot. She says they are redoubling their efforts and making green hydrogen and ammonia reliable and commercially viable energy sources. She also added that there is increasing demand from governments and industries for carbon free hydrogen, particularly for use in decarbonizing hard to abate sectors such as steel, cement, and ammonia production as well as heavy duty transportation. Now, these deals mark the second major investment from Keppel in hydrogen and ammonia. In recent months, in November of 2022, Keppel signed a joint study agreement with Pertamina and Chevron for 120,000 tonnes per year of hydrogen capacity and upwards scalability from the Sumatra hydrogen project in Indonesia phase one of which will begin production and 2027.
Okay, so great news. And as I said, I'm glad to see that projects we've covered in the past have continued to move forward in their development. Now, this time around, we have estimated production numbers of 200 tons per day initially, with hopes to scale up to 800 tons per day within three years of starting production. And what I really like about this announcement is that this methodology of green ammonia development in Australia and shipped to Asia is continuing. That seemed to have been the plan from the get go, and has also shown success over the last several months of being economically viable and scalable, those two things being the most critical components of making the Asia Australia hydrogen trade market successful. And on that topic, if you don't know what the CQ HQ project is, it involves the development of a hydrogen production facility, hydrogen gas pipelines and hydrogen liquefaction facility as well as supply of hydrogen to an ammonia production facility. The CQ h2 project aims to deliver renewable hydrogen via its different carriers to Japan and Singapore, as well as supplying large domestic customers in central Queensland. commercial operations are plan to commence like I said in 2028, and this project has secured feed funding from all consortium members as well.
Well as $20 million from the Australian Renewable Energy Agency or arena and $15 million from the Queensland Government's Queensland renewable energy and hydrogen Jobs fund, and so a Singapore's Keppel arena and the Queensland Government all supporting this project, shipping infrastructure already in place and off taker and consumers lined up to take the ammonia. This project shows clear signs of being one to lead the way and global hydrogen trade. Next in a press release from Business Insider, WSP USA completes drilling two wells at a hydrogen hub designed for curtailed renewable energy use. WSP USA, a leading engineering environment and professional services consultancy has successfully completed drilling operation and mechanical integrity tests for two new cavern wells for the advanced clean energy storage or ACEs. One project in Utah part of the first phase for the ACES Delta hydrogen hub, the advanced clean energy storage one project will convert renewable energy into green hydrogen that can be stored in utility scale solution mind domal salt caverns the ACES Delta hydrogen hub controls the only known Gulf Coast style domal quality salt formation in the western US, which contains five existing salt caverns already being used for storing liquid fuels.
The advanced clean hydrogen energy storage one is a wholly owned subsidiary of ACEs Delta LLC. Aces Delta is a joint venture between Magnum development and Mitsubishi power Americas. WSP was contracted for the designing, drilling and completion of both cavern wells. Beside the drilling operation. WSP was responsible for designing procuring and managing the construction process of the project's solution mining surface facility to provide water and power to the wells sites. And we'll manage the solution mining process until final completion of both caverns and a quote from Scyller Borglum underground storage leader for WSP USA hydrogen underground storage is a key component of the hydrogen economy, which is critical in the effort to decarbonize us power generation. These underground salt dome caverns will provide a huge reservoir of renewable fuel for future power generation, supporting levels of utility scale renewable energy storage that have not been previously possible. The drilling operation for each cavern well was completed ahead of schedule, and both cavern wells have successfully passed the mechanical integrity test designated to ensure well integrity prior to the start of the solution mining process.
Upon completion of the solution mining process, the total cavern volume of 9 million BOE are barrels of oil equivalent will be able to store around 300 gigawatt hours of clean reliable energy in the form of hydrogen. These will be the fourth and fifth hydrogen compatible caverns in the US and the salt caverns storage capacity will make it possible to store excess renewable energy produced in the spring when energy demand is low and use it to generate energy in the summer when demand is high. Alright, so this is fantastic news on the future of hydrogen storage capacity in the US now, as the press release states, these salt domes are mainly found in the Gulf area of the US. So develop this dome with the ability to store it 9 million barrels of oil equivalent of hydrogen away from the Gulf Coast is a big win. And as an aside, 9 million BOE is also the equivalent of 40,000 megawatts of lithium ion batteries. Now, that 300 gigawatt hours of hydrogen will be stored in two caverns, which will hold about 11,000 metric tons of hydrogen. Now, aside from that, I can only assume they have been able to estimate that much hydrogen volume will be generated for the site to be fully utilized. Now for reference, this project is adjacent to the inner Mountain Power Project near Delta, Utah.
And if you remember, this was the coal plant that powered a large part of Southern California, including Los Angeles. But since this project is strictly utilizing renewable electrolytic hydrogen, I get a bit nervous that regulatory hurdles from California may need to be taken into consideration if additionality requirements are put in place. I'm also hoping to see more salt dome storage develop throughout the US like this project that will be technology agnostic and just simply store hydrogen without regard as to how that hydrogen was developed.
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