Japan to provide A$2.35bn for Australian hydrogen demonstration

AUSTRALIA will receive A$2.35bn (US$1.6bn) in funding from Japan to demonstrate a liquefied hydrogen supply chain running from Victoria in Australia to Kobe in Japan.

In February 2022, the hydrogen energy supply chain (HESC) pilot project was successfully completed when a purpose-built vacuum insulated tank loaded with hydrogen extracted from Latrobe Valley coal arrived by ship to Kobe.

The next stage of the project will see the newly formed J-Power and Sumitomo Corporation joint venture (JPSC-JV) produce 30,000 t/y of hydrogen gas from Latrobe Valley coal. The coal will be supplied to a liquefaction and shipping facility at the Port of Hastings. Hydrogen production is expected to begin in the late 2020s and the project will include technology to capture carbon emissions.

Fiona Beck, who researches the hydrogen economy and the energy transition at Australian National University, welcomed the investment in infrastructure to liquefy, store, load, and transport hydrogen but warned that the investment “risks locking us in to using fossil fuels for longer” while the cost of production from renewable sources falls.

“There’s a risk of stranded assets in this area,” she told the Guardian.

Collaboration for e-methane

In another demonstration partnership, Australia’s Santos and Osaka Gas Australia have entered into an agreement for pre-front end engineering and design (pre-FEED) work on a demonstration scale project to produce carbon neutral e-methane. OGA is a wholly owned subsidiary of Japanese energy company Osaka Gas.

The demonstration would produce e-methane from green hydrogen and CO2 that is captured at industrial sites or by direct air capture (DAC) technology. 

Santos and OGA aim for FEED entry in 2024, and a final investment decision in 2026, for a plant that will export 60,000 t/y of e-methane by 2030.