Indonesian state-owned firms have signed initial agreements with Germany's Augustus Global Investments (AGI) to build a green hydrogen production plant in the southeast Asian country's Aceh province.
AGI plans to build a green hydrogen production plant of 35,000 t/yr capacity in about 50 hectares (ha) of land. The cost of developing the plant is estimated to be around $400mn-700mn, depending on the final form of green hydrogen to be transported, whether compressed, liquid or in other forms.
Indonesian state-owned fertiliser companies Pupuk Indonesia, Pupuk Iskandar Muda and PLN have signed two initial agreements with AGI, Indonesia's ministry of energy and mineral resources (ESDM) said on 28 August.
AGI has signed the first initial agreement with state-owned Pupuk Indonesia and Pupuk Iskandar Muda to secure land for the green hydrogen production project. The second deal has been signed with PLN to secure the supply of renewable energy.
The project will be located in Arun Lhokseumawe special economic zone (SEZ) in the Aceh province of Indonesia, considering the region has abundant renewable energy resources and strong support from the government.
Indonesia has "strong capital" for the development of green hydrogen and the potential to become a global hydrogen hub considering its "strategic location" near the international trade route, the ministry said.
Indonesia's current hydrogen consumption is around 1.75mn t/yr with 88pc utilisation in the urea sector, 4pc in ammonia and 2pc in oil refineries. It plans to start decarbonisation of the transportation sector by 2031 and the industrial sector from 2041, ESDM secretary general Dadan Kusdiana said.
