Orica has been conditionally awarded $432 million in ARENA Hydrogen Headstart funding to support the operation of the Hunter Valley Hydrogen Hub (HVHH), subject to Financial Investment Decision (FID) and requisite pre-conditions being met.
The funding has been awarded under Round One of the Australian Renewable Energy Agency’s (ARENA) competitive Hydrogen Headstart program. This program supports large-scale renewable hydrogen projects to accelerate the development of Australia’s hydrogen industry, helping the country connect to new global hydrogen supply chains.
The funding aims to provide partial revenue support in the form of production credits once the project is commercially operational, bridging the commercial gap for first-mover renewable hydrogen projects in Australia. The Headstart funding complements support already announced by the New South Wales and Federal Governments to establish the HVHH at Kooragang Island.
The HVHH will deliver a safe, reliable, and commercial-scale renewable hydrogen supply chain in the Newcastle industrial and port precinct. The proposed facility, which received development approval in May 2024, will produce renewable hydrogen via electrolysis using recycled water and renewable electricity via a grid-connected 50MW electrolyser in the first phase.
Renewable hydrogen manufactured at the Hub is planned to gradually replace natural gas feedstock in the production of low-carbon ammonia and ammonium nitrate. These products are essential for various industries across Australia, including resources, agriculture, health, and food.
The first phase of the HVHH is expected to produce approximately 12 tonnes of renewable hydrogen per day, reducing Orica’s daily natural gas demand for chemical feedstock by around 7.5%, releasing gas back into the grid for domestic consumption. The estimated annualised emissions benefit at phase one of full production is equivalent to taking approximately 26,500 cars off the road each year.
Orica considers the HVHH to have significant merit, with the differentiating benefits of a strategic location at the Port of Newcastle and established end markets in the resources and agriculture industries. Orica’s Kooragang Island ammonia plant is the only ammonia plant operating on Australia’s east coast with direct access to a deep-water port for international customers and the Port of Newcastle’s Clean Energy Precinct.
The HVHH also offers a strong foundation for social, environmental, and economic benefits in the Hunter region. It will significantly contribute to the region’s industrial decarbonisation and manufacturing base, creating an opportunity to transition the large, skilled regional workforce currently employed within high-emitting industries.
The HVHH also presents an opportunity to partner with Traditional Owners and other First Nations community members, as well as the wider local residential and business communities, to ensure the benefits of the renewable energy economy are shared appropriately.
IMAGE | Orica Operations
