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Japan's Osaka Gas backs $11 bln hydrogen project in Australia

Osaka Gas Co Ltd has agreed to jointly develop a $10.75 billion green hydrogen project in the Australian outback, the project's developer, Aqua Aerem, said without disclosing how much the Japanese utility would contribute.

The Desert Bloom Hydrogen project, backed by Singapore-based Sanguine Impact Investment Group, will use a unique technology to suck water out of the air and solar power to split the water to make green hydrogen in the Northern Territory's desert.

Osaka Gas has agreed to contribute project management, engineering and technical support for the project, manage hydrogen sales, and negotiate with equipment manufacturers, Aqua Aerem said.

Osaka Gas said it would comment on the agreement shortly.

If it goes ahead as planned, the project could be the first producer of green hydrogen in Australia, planning to start up in 2023, while a raft of other projects are still running feasibility studies.

Desert Bloom will start small, using Aqua Aerem's 2 megawatt production units, which the company says can generate water from the air, produce heat, renewable electricity and green hydrogen.

Eventually, to get to its target of 410,000 tonnes a year of hydrogen for local use and exports, the project will scale up to 4,000 modular units, driving down production costs.

"Desert Bloom will be on track to produce green hydrogen at an export price international customers want to pay - less than $2/kg within five years," Aqua Aerem Chairman David Green said in a statement.

The Northern Territory government awarded the project "major project" status in December, putting it on a fast track for obtaining approvals.

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