State Government forging ahead with $140m hydrogen hub despite BP exit from Pilbara green hydrogen project

Construction of a green hydrogen precinct in the Pilbara using $140 million of taxpayer cash is still moving forward despite BP exiting a key project the initiative could support. A $55 billion Pilbara green hydrogen project was dealt a huge blow on Thursday after the venture’s majority shareholder, BP, pulled out to focus on its core oil and gas business. BP is relinquishing its 64 per cent stake in the Australian Renewable Energy Hub — slated to be the green hydrogen production centrepiece in WA’s most resources-rich region. But the State Government will move ahead with its Pilbara Hydrogen Hub common-user infrastructure proposal regardless. Energy giants across the globe are curbing investment into green hydrogen projects as hype around the clean fuel’s commercial viability wanes. Singapore’s InterContinental Energy has taken the reins from BP as the operator of AREH, which aims to produce 1.6 million tonnes of hydrogen annually using energy generated by a sea of solar panels and wind turbines. The AREH setback comes 18 months after the State and Federal Governments agreed to each tip in $70m to build the Pilbara Hydrogen Hub nearby to support the industry. PHH hopes to provide “common-user infrastructure, skills development, and future expansion works required to grow hydrogen opportunities in the Pilbara region”, according to the WA Government’s Pilbara Development Commission. This includes construction of a hydrogen “and/or” ammonia pipeline, providing skills training related to clean energy, and upgrading infrastructure at Port Hedland to accommodate imports of renewable energy equipment like wind turbine blades. A Cook Government spokesman on Friday said BP’s AREH withdrawal would not prevent PHH from being in operation by mid-2028. “The State Government remains committed to the Pilbara Hydrogen Hub which, when operational, will leverage WA’s existing strengths and support the world’s clean energy transition,” the spokesman said. “Hydrogen remains an emerging export opportunity for WA. “By playing a role in de-carbonising WA’s major trading partners through LNG exports now, then green hydrogen exports later, the State Government will continue to build on its strong record of creating jobs and supporting new business opportunities.” A spokeswoman for Federal Climate Change and Energy Minister Chris Bowen did not respond to a request for comment. BP’s AREH exit came during the same week as Fortescue and Woodside Energy pulled the pin on green hydrogen projects in Queensland, Arizona and Oklahoma. But Woodside said it still planned to develop a $1b-plus liquid hydrogen production facility near Kwinana called H2Perth. “We had previously proposed an ammonia and hydrogen facility, but have revised our concept to liquid hydrogen only, based on market feedback,” a company spokeswoman said on Friday. “H2Perth aims to make liquid hydrogen available initially for export, while creating employment and local content opportunities, as well as providing an opportunity to establish a new strategic export industry for Western Australia.” Construction on H2Perth was originally scheduled to start last year but first sod is yet to be turned.