Elixir, SB Energy progress Gobi H2 plan in Mongolia

  • Market: Hydrogen
  • 21/02/23

Australia-headquartered Elixir Energy and Japanese independent power producer SB Energy are progressing plans to develop a green hydrogen project in the south Gobi region of Mongolia.

The Gobi H2 project is planned to initially focus on a 10MW electrolyser pilot to produce green hydrogen, powered by new wind and solar facilities, Elixir's managing director Neil Young said on 21 February. A pre-feasibility study indicates that the pilot can produce 1,440 t/yr.

Elixir announced the signing of a non-binding agreement with SB Energy on 20 February, with an eye on entering a formal joint development deal and a 50:50 joint venture, after a front-end engineering design (FEED) decision on the pilot later this year.

"The scalability provided by starting with a pilot is a big competitive advantage over e.g. marine transport-based green H2 projects — which will tend to have to be very large from their inception," Young said. "A pilot in this location can serve to give comfort to multiple stakeholders (customers, banks, etc) about viability, hence giving confidence over much larger future FID decisions."

It is unclear when a final investment decision (FID) on the project can be made. It "might be say 1 year later [after FEED]," Young said. "Construction could be say another year. All rough estimates at this point."

The firms have also not yet decided on which type of electrolyser technology to go with for the project. "Our PFS [pre-feasibility study] work has identified alkaline as being more suitable, given cost and other reasons," Young said. "However, given how dynamic the sector is, it does seem feasible that in the FEED stage PEM [proton exchange membrane] might get a look in."

No date has been set yet for when production is targeted to start but there are plans for a "longer term gigawatt-scale project" targeting China as an export market, he said.

"The pilot could also supply China — by CNG [compressed natural gas] truck," Young said. "But [it] could also be attractive to local demand nodes such as mine sites, long distance transport... We are canvassing multiple options at this point," Young said.

State-backed China Hydrogen Alliance predicts that national hydrogen demand could rise to 130mn t by 2060 up from 33.4mn t in 2020, and account for a fifth of final energy consumption. China is targeting 50,000 hydrogen fuel-cell vehicles on its roads by 2025, as part of its hydrogen development plan for 2021-35.


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Q&A: Shell Oman to balance upstream with renewables


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24/05/24

Q&A: Shell Oman to balance upstream with renewables

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20/05/24

Q&A: Marine CO2 goals need culture shift: TotalEnergies

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Clean hydrogen industry still upbeat but more realistic


17/05/24
News
17/05/24

Clean hydrogen industry still upbeat but more realistic

London, 17 May (Argus) — The clean hydrogen sector still lacks tangible progress and final investment decisions (FIDs) for projects remain few and far between, but it is reaching a moment of reckoning essential for market maturity, delegates at the World Hydrogen Summit in Rotterdam said. When asked whether they were more or less positive than a year ago, industry participants gave diverging answers, but there was widespread agreement that progress on clean hydrogen has been slower than expected. This has been "the year of doldrums", the Dutch port of Rotterdam's hydrogen supply chain programme manager Martijn Coopman said. Increasing material and financing costs, the unstable geopolitical situation and a lack of clarity on regulatory frameworks are just some of the challenges developers have faced. This is a "grim environment if you were expecting the Swiss army knife approach" to work, industry body the Australia Hydrogen Council's chief executive Fiona Simon said, alluding to the — misguided — expectation that hydrogen could be used across all sectors to help decarbonise. "We are coming to terms" on the real use and appropriate applications of hydrogen, Simon said, pointing to green steel production. "We are converging on the same concepts and same policies". The industry has reached the point where the wheat is separated from the chaff and it is becoming a lot clearer which projects will actually materialise. There is now a greater sense of "realism" underpinning discussions according to Dutch gas company Gasunie chief executive Willemien Terpstra. And this is why market participants are more optimistic than a year ago. Demanding as ever Still, delegates widely urged more policy action, especially on the demand side, which has been a recurrent theme. Spurring on demand will be key to get to more FIDs, Spanish utility Iberdrola's hydrogen development director Jorge Palomar Herrero, said. "We can have great intentions and great projects but without the demand, they are not going to happen". Even in Europe, which has pushed ahead with efforts to stimulate demand, these have not been enough to spur offtake, Herrero said. Demand-side incentives alone will likely not be enough and eventually there will have to be consumption obligations too, some said. Incentives may help to reduce project costs and kickstart production, but the amount of "carrots" needed is "phenomenal", so "sticks" will be key, the port of Rotterdam's Coopman said. Consumption mandates could help accelerate momentum in emerging markets and developing countries that have big ambitions for exports to future demand centres, the World Bank's private sector arm IFC energy chief investment officer Ignacio de Calonje said. Governments are now ready to act on these requests, according to industry body the Hydrogen Council's director for policy and partnerships Daria Nochevnik. "The penny has dropped," Nochevnik told Argus , noting that the need for demand-side action was the number one priority outcome of a ministerial-executive roundtable held in Rotterdam this week. Red and blue Governments must also remove red tape to speed things up, conference delegates said. European developers in particular are increasingly frustrated with paperwork involved in funding applications, according to German utility Uniper's vice-president for hydrogen business development Christian Stuckmann. Shortening lengthy permitting and funding processes is also high on governments' lists, Nochevnik noted. Some delegates renewed calls for a wider acceptance of "blue" low-carbon hydrogen made from natural gas with carbon capture and storage to address concerns that, if it is up to renewable hydrogen alone, things will start too late — or not at all. There appeared to be widespread consensus that this low-carbon hydrogen will have a key role to play, especially in a transitional period, as it can already deliver significant emissions reductions. But there is still a "stigma" in Europe, according to industrial gas firm Linde's vice-president for clean energy David Burns. This could hamper its adoption, which many delegates argued the world cannot afford. By Pamela Machado Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Japanese bank Mizuho boosts support for H2, ammonia


17/05/24
News
17/05/24

Japanese bank Mizuho boosts support for H2, ammonia

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