BP forges ahead with WA green hydrogen despite ‘high complexity’

BP will aggressively chase Pilbara miners to buy its green hydrogen ahead of exporting it, as the UK oil and gas major gets the ball rolling on the $US36 billion ($56 billion) green hydrogen project in Western Australia.

BP bought a 40.5 per cent share of the Asian Renewable Energy Hub in June. If fully developed, the hub would cover 6500 square kilometres of northwest WA with more than 1700 wind turbines – up to 290 metres high – and 18 large-scale solar farms.

BP chief financial officer Murray Auchincloss said he expects power to start flowing from the hub sometime between 2025 and 2027.

“First of all, it’s a domestic play,” he told investment analysts this week. “Can we bring green hydrogen or green power to the nearby mining and other industries?”

BP’s decision to chase domestic customers is the third attempt by stakeholders to generate revenue from 26 gigawatts of solar and wind energy, planned for a location remote even by the standards of northwest WA.

Since the hub was first conceived, demand for clean energy has appeared in the Pilbara with Fortescue aiming to be emissions-free by 2030 and fellow iron ore miners Rio Tinto and BHP planning substantial cuts in emissions.

The Asian Renewable Energy Hub got its name from a plan to use subsea cables to sell power to Java, Indonesia’s most populated island. The idea died from a lack of customers with the financial strength to underwrite the project with solid long-term power purchase agreements.

In 2020, the project’s proponents switched to using the emissions-free power to separate hydrogen from water using electrolysers, and then adding nitrogen to produce more easily transported ammonia for export.

The expansion from 15GW to 26GW and the addition of an export port was rejected in 2021 by then Coalition environment minister Sussan Ley as “clearly unacceptable”, as the port could affect a wetland bird habitat on Eighty Mile Beach protected by international agreements.