Hunter Valley Hydrogen Hub (Archived)
Hunter Valley Hydrogen Hub
The project proponents are progressing a large-scale renewables-based hydrogen project located in the Newcastle industrial and port precinct.
| Main proponents:
Origin Energy |
Main end-use classification:
Industrial process – ammonia production and mobility applications |
Status:
Archived – exploring commercial options |
Estimated cost:
Capital cost estimated at between AUD$200-250 million |
| Other involvement:
Orica
|
Production details:
Approximately 4,700 tonnes of renewables-based hydrogen production per annum, based on a 50-megawatt (MW) electrolyser |
Location:
New South Wales, Australia |
Announced funding:
AUD$70 million – Australian Government Regional Hydrogen Hubs Program – Hub Implementation funding stream AUD$45 million – New South Wales Hydrogen Hubs Initiative |
Project description
(Note: This project is one of six applicants that have been shortlisted by ARENA and invited to submit a full application in the next stage of the AUD$2 billion Hydrogen Headstart Program.)
In February 2022, Origin Energy and Orica announced their intent to complete a feasibility study into the viability of a renewables-based hydrogen production facility and associated value chain project located in the Newcastle industrial and port precinct.
In July 2023, it was announced that Origin Energy was the recipient of AUD$70 million in funding (through the Australian Government’s Regional Hydrogen Hubs Program – Hub Implementation funding stream) to progress the proposed Hunter Valley Hydrogen Hub project. In addition, in September 2023, it was announced that Origin Energy was recipient of AUD$45 million in funding through the New South Wales Government’s Hydrogen Hubs Initiative to progress the project.
The fundings provided by the Federal and New South Wales Governments is in support of the initial (first) stage of overall project development.
The initial stage of the project involves the development of the hydrogen production facility, hydrogen supply pipeline and recycled water connection on Kooragang Island (in Newcastle around 174 kilometres north of Sydney).
The initial stage of the proposed project consists of a 50-MW electrolyser system (comprising several large-scale electrolysis modules) and is expected to produce 4,700 tonnes of renewables-based hydrogen per annum. Storage capacity would be through high pressure storage vessels with a combined capacity of 4.75 tonnes. A PEM electrolysis system has been selected for the development.
The hydrogen hub would be supplied by supplied by grid-connected renewable electricity (through purchase and retirement of large-scale generation certificates and/or renewable electricity guarantee of origin certificates in the future) and locally sourced recycled water.
The hydrogen production plant and associated facilities are located in close proximity to the Orica ammonia/ammonium nitrate manufacturing facility also located on Kooragang Island, which is proposed to be the main offtake recipient of the produced hydrogen, with the remaining hydrogen made available for mobility use. A dedicated hydrogen supply pipeline of approximately 720 metres would connect the Origin hydrogen production/storage facilities with the Orica ammonium nitrate plant.
The project completed front-end engineering design (FEED) studies in December 2023 to inform the final technical and commercial details of the development. The project development application, Environmental Impact Statement (EIS) and associated documents were placed on public exhibition in the third quarter of 2023. In May 2024, the project was granted development consent to the development application subject to conditions.
Pending a final investment decision, the project is targeting first hydrogen production from 2026. A final investment decision is expected in CY2024.
The initial phase of the project is focussed on producing hydrogen for domestic use cases. Future phases, proposed to be located at the nearby Port of Newcastle, Clean Energy Precinct are being designed with the potential for export development.
(Note: the October 2022-23 federal budget released on 25 October 2022 included a broad support measure of AUD$100 million to support the Port of Newcastle and the Hunter region to become hydrogen-ready.)
In October 2024, Origin released an update on the Hunter Valley Hydrogen Hub announcing its intention to exit this potential hydrogen development project. Origin noted that the decision to exit reflects the prioritisation of capital expenditure towards opportunities closely aligned to Origin’s strategy, with investments focussed on renewables and storage. In its release, Origin notes it remains open to exploring commercial options for the Hunter Valley Hydrogen Hub. If commercial options to continue the project were to prove fruitful, then a transfer back to the HyResource – Active page would be reviewed at that time.
Reviewed: October 2024