BP Sets Sights on AREH as Latest Venture Into Hydrogen

BP prepares to take stake in one of Australia’s biggest hydrogen and renewable energy projects, the Asian Renewable Energy Hub (AREH) located in the Pilbara region of Western Australia (WA).

The AREH aims to export 10 million tonnes per year of green ammonia with the electricity generated from the 26,000 MW of wind and solar facilities it plans to build. While BP did not comment on reports, it is expected to take a 30% stake in the project, which has been initially estimated to cost A$36bn ($25bn) to build the 16,000MW of onshore wind and 10,000MW of solar for hydrogen and ammonia production.

Around 3,000MW of the installed capacity is planned to be used for large energy consumers in WA, where Australia’s largest iron ore mines are located. AREH aims to make a final investment decision (FID) on the project in 2025.

BP has set ambitious targets to comply with climate change targets, including cutting scope one and two greenhouse gas emissions by 50% by 2030. The company also targets to reach net zero emissions by 2050, including lifecycle emissions from the products it sells.

BP has previously looked into the production of hydrogen from renewable energy at its Kwinana refinery located in south of Perth, WA, but the facility was closed last year. It has also explored development of a pilot plant, located near the WA port of Geraldton, to produce 4,000 tonnes per year of hydrogen and up to 20,000 tonnes per year of ammonia.

Current shareholders of the AREH include Danish wind turbine manufacturer Vestas, Australian private-sector energy firm CWP Renewables, and Hong Kong-based energy firm InterContinental Energy.

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