SunHQ Hydrogen Hub
SunHQ Hydrogen Hub
The initial phase of renewable hydrogen production at a zinc refinery near Townsville involves a one-Megawatt (MW) electrolyser to be powered through a behind the meter connection to an existing 121 MW solar farm.
| Main proponents:
Ark Energy Corporation Pty Ltd |
Main end-use classification:
Hydrogen mobility – offtake solutions under review |
Status:
Under construction – completion of Phase 1 construction/commissioning activities is expected in the new year (2025) |
Estimated cost:
AUD$12.97 million original budget subject to review (Phase 1) |
| Other involvement:
|
Production details:
Hydrogen production – approximately 140 tonnes annual capacity available (based on the first phase 1 MW electrolyser plant). |
Location:
Queensland, Australia |
Announced funding:
AUD$8.08 million – Queensland Government Hydrogen Industry Development Fund AUD$6.1 million – Australian Renewable Energy Agency (ARENA) AUD$12.5 million – Clean Energy Finance Corporation (CEFC – debt finance facility) Source: Ark Energy project webpage |
Project description
Ark Energy Corporation Pty Ltd (Ark Energy) is an Australian subsidiary of Korea Zinc Company Ltd (Korea Zinc), the world’s largest zinc, lead and silver producer. Ark Energy was established to decarbonise the energy supply of the Korea Zinc group globally. The first project on this pathway – the SunHQ Hydrogen Hub – is planned to take place in North Queensland. Ultimately, after stimulating demand in the domestic market, a longer term ambition of Ark Energy is to export green hydrogen to Korea.
Sun Metals Corporation Pty Ltd (SMC), an Australian subsidiary of Korea Zinc, owns and operates a zinc refinery 15 kilometres south of the city of Townsville in North Queensland. The refinery currently produces 220,000 tonnes of zinc metal per annum.
The Sun Metals refinery is the second largest single site electricity user in Queensland, which has driven the company to develop alternative energy strategies. In 2018, SMC completed development of a 121 megawatt (MW) solar power plant which provides approximately 25 per cent of the energy requirements of the zinc processing facility.
The initial phase (Phase 1) of the SunHQ Hydrogen Hub project involves the installation of a 1-megawatt (MW) PEM electrolyser co-located at the Townsville refinery. The electrolyser would be powered through a behind the meter connection to the existing 121 MW solar farm. The electrolyser would have the capacity to produce approximately 140 tonnes of hydrogen per annum.
The produced hydrogen was intended to be used mainly in diesel fuel displacement. Ark Energy originally envisaged procuring five new hydrogen fuel cell heavy haulage trucks (each 140 tonnes capacity) from Hyzon Motors and leasing them to its sister company, Townsville Logistics Pty Ltd, for its short haul fleet operating between the Port of Townsville and the Sun Metals refinery, a 25-kilometre round-trip. Noting the recent withdrawal of Hyzon Motors from Australia, Ark Energy is reviewing the project’s offtake solution.
The potential to supply non-refinery customers with short haul fleets running back to the SunHQ base would exist from the date of operations.
Further phases of the project would build to expand on the domestic market and develop export opportunities for green hydrogen into Korea. In this vein, in September 2021, it was announced that Ark Energy and the Port of Townsville had signed a Memorandum of Understanding to undertake a feasibility study that would investigate the development of a renewable hydrogen facility focused on the transport industry at the Sun Metals’ zinc refinery in Townsville, along with hydrogen export facilities at the Port of Townsville.
The project webpage indicates that funding and concessional financing in support of the project has been received from:
- AUD$8.08 million in funding from the Queensland Government under its Hydrogen Industry Development Fund.
- AUD$6.1 million in funding from ARENA under its Advancing Renewables Program.
- Up to AUD$12.5 million in concessional financing from the CEFC.
Further details on the design concept (and key design parameters) for this project can be found in the SunHQ Hydrogen Hub Market and Technology Report (dated September 2022) prepared as a knowledge sharing report for ARENA.
In April 2023, ARENA announced release of the project report SunHQ ARK Lessons Learnt 2. This report outlines the importance of equipment compliance within Australian standards.
Reviewed (reviewed by the project proponent): November 2024