Growing interest in plant

A demand for global green hydrogen has resulted in multinational companies knocking at the door to become involved in the Southern Green Hydrogen project.

Meridian Energy and Contact Energy called for registrations of interest in July, after a McKinsey & Co report revealed a plant had the potential to earn hundreds of millions of dollars in export revenue and help de-carbonise societies in New Zealand and overseas.

Yesterday it was announced 80 registrations of interest had been received.

The Tiwai Point Aluminium Smelter site near Invercargill has been mooted as one of the prospective locations, if it closes down at the end of 2024.

However, Meridian general manager development Guy Waipara yesterday said a number of locations around Invercargill and Bluff were of "most interest" for the plant.

A decision on where the plant would be located would not be made until the end product was finalised, he said.

Three products were being investigated — liquid hydrogen, ammonia and green iron.

"Those different products have got preferences to be closer to or further away from port for example, so as we kind of narrow down what the best partnership option is and what the best product is, then that will come out in the wash really."

Of the 80 registrations of interest, the majority were from international parties in Asia, Europe and Australia, with some acknowledging a desire to invest in the project.

"Of the slightly over 50 international responses, a number of them are interested in the domestic market as well as the international market."

"We’ve got the companies that we really wanted to have an attempt, we’ve got an attempt , so we’re really pleased about that."

Mr Waipara said he was impressed with the quality of responses from multinational companies, with representatives from the mining, chemical and petrochemical sectors involved.

A large number of responses were also received from engineering and technology companies interested in developing the infrastructure needed to produce and transport hydrogen from Southland.

The future of hydrogen would have a massive impact globally as it was difficult to decarbonise industry at present, he said.

"If you look at shipping and large transport there’s really no alternative and there’s a lot of industrial processes like steel making and aluminium manufacture that currently use carbon and if you’re going to decarbonise those, then all roads lead to hydrogen again."

With little global green hydrogen large-scale development, New Zealand was on the cusp of something quite revolutionary, he said.

Contact Energy chief executive Mike Fuge said the fact international companies were looking at business opportunities in New Zealand’s domestic market, in addition to international opportunities, was very promising.

"New Zealand has a stable political environment and a realistic and rising price on carbon.

"These are good incentives for people to dial down fossil fuels and convert to cleaner alternatives, so the fundamentals are there for hydrogen to take on fossil fuels in a range of sectors."

Mr Fuge said hydrogen innovation was an area Kiwi businesses and scientists were working out how to produce clean fuel more efficiently and cost-effectively.

"We’re already exporting some of this technology, and the opportunities are set to grow if New Zealand seizes the opportunity to become a global leader in green hydrogen."

Meridian chief executive Neal Barclay said there was a huge appetite for green hydrogen to replace fossil fuels.

"Green hydrogen has the potential to abate Aotearoa’s long-life greenhouse gas emissions by more than 20%. It’s exciting to see so much interest in domestic applications alongside the export opportunities.

This interest suggests that the domestic uptake of hydrogen as a clean fuel could happen sooner and faster than we expected."

The next phase of the project is a series of more formal discussions with shortlisted parties, followed by a request for proposal process to determine key partners and build the wider supply chain and end-use customers.

The process, which is already under way, is expected to be completed by March 2022.

karen.pasco@odt.co.nz