All systems go on hydrogen for Fortescue as iron ore output falters

More ambitious moves are ahead, as Fortescue is sticking to its target of making a final investment decision on five green hydrogen projects this year. The fuel and chemical feedstock is produced by separating hydrogen from water using renewable energy. It can be used to make ammonia for ease of transport or as a fertiliser ingredient.

Fortescue Future Industries (FFI) chief executive Mark Hutchinson said contenders for a 2023 investment included making hydrogen to power transport in Arizona and Texas, exporting ammonia from Brazil and Norway to Europe, producing fertiliser in Kenya, and converting an Incitec Pivot gas-fuelled Gibson Island ammonia plant near Brisbane to manufacture the green product.

The Queensland project would consume 500 megawatts of energy to make 70,000 tonnes of hydrogen annually.

Geothermal energy in Kenya and hydroelectricity in Norway will both provide about 300 megawatts of clean energy to Fortescue’s projects, indicating an annual production of about 42,000 tonnes of hydrogen each. FFI is considering a pipeline of more than 100 projects.

Forrest wants Fortescue to produce 15 million tonnes of the green fuel and chemical feedstock annually by 2030, the equivalent of more than 200 Gibson Islands.

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Hutchinson said he could not reveal the likely cost for the projects until later this year when commercial terms were agreed.

“All I can say is we’re learning every day and working very hard to make sure we get five to a final investment decision this year,” he said.

The former General Electric executive said there were encouraging signs the Australian government might offer incentives to clean energy investments to match the Inflation Reduction Act in the United States, which would keep Australia “in the game”.

Fortescue shares fell 3.4 per cent on Monday to $20.76 a share.

Meanwhile, shares in fellow Perth-based resource company South32 plunged 7.4 per cent to $4.12 after the diversified miner’s March quarter production dipped for all its commodities compared to the preceding three months.

Alumina tonnage dropped 9 per cent due to maintenance at a refinery in WA, and difficult mining conditions in NSW drove metallurgical coal output down 16 per cent.

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