BP’s Asian Renewable Energy Hub (AREH) in Western Australia (WA) will initially produce green hydrogen for domestic consumption before targeting exports in a second phase.

The oil major completed its acquisition of a 40.5pc share in the project, which has planning consent for 15GW of wind and solar capacity during, the most recent quarter. BP hopes to take FID in 2025, from which date the project will initially operate as a domestic provider of renewable energy and green hydrogen to the local mining industry.

From the end of the decade, BP—which is also operator of AREH—will look to target export markets to international customers from the deepwater ports of Dampier and Port Hedland.

“The domestic side is relatively straightforward,” says BP CFO Murray Auchincloss on BP’s third-quarter results call. “The complexity on the international play is high—locking in customers, locking in stakeholder rights, locking in serious capacity for the electrolysers and securing debt financing for what would be a very big investment.”

Look north

BP and its partners in AREH—developers Intercontinental Energy and CWP Global, as well as finance giant Macquarie—hope eventually to make the project a key supply node for shipping hydrogen molecules to Asia-Pacific markets, particularly Japan and South Korea.

“The domestic side is relatively straightforward” Auchincloss, BP

BP was allocated land at the Oakajee Strategic Industrial Area by the WA state government for the project last month.

WA has committed A$47.5mn ($30.7mn) to the development of the Oakajee Strategic Industrial Area and is putting in place road infrastructure as a first step towards developing the region into a globally competitive renewable hydrogen precinct.

The state also allocated land to green hydrogen developer Fortescue Future Industries, local firm Green LOHC, Danish fund manager Copenhagen Infrastructure Partners and energy equipment company Blue Diamond Australia.

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Author: Stuart Penson