Since Rio Tinto’s announcement of the potential closure of its Tiwai Point smelter, Southland leaders and the Government have been exploring opportunities to diversify the local economy as well provide an alternative use for the large amount of electricity used to power the smelter.
Clean energy industries are at the core of the Government’s plan for Southland and the Southern Green Hydrogen project — a joint venture between Meridian Energy and Contact Energy to develop the world’s first large-scale green hydrogen plant in Southland — appears to be progressing well.
Yesterday, four potential development partners were announced as being shortlisted for the project.
They list comprises: a Japanese consortium of Mitsui & Co, Ltd., one of Japan’s largest trading and investment companies, and ENEOS, one of the country’s leading integrated energy companies; leading gases and engineering company BOC, which is involved the production, processing, storage and distribution of hydrogen; Australia’s Fortescue Future Industries (FFI), a subsidiary of Fortescue Metals Group, a global green energy company; and Woodside Energy Limited, Australia’s leading natural gas producer.
Meridian development general manager Guy Waipara said he believed there was enough space — and energy — for multiple ventures in Southland.
Mr Waipara said the shortlist was a major step forward in the commercialisation of the area’s proposed green hydrogen venture and it was a key point for the feasibility of the project.
The interest in the project demonstrated the potential market the new venture could have, he said.
"We are very confident we can build the facility but the key part is to find someone to really sign up for a long-term deal to take the product into the future."
The announcement by Rio Tinto of its intention to keep the smelter open beyond 2024 would not have an impact on the project, he said.
Mr Waipara said it was hard to comment further on the matter as Meridian was not in any kind of discussion with Rio Tinto about a potential new contract.
"Ultimately it is their decision.
"But we think there is a world in which we could support both. If everything pans out, it is not necessarily an either/or [situation]. There is potential for both of those things to work in Southland."
It was still too early to address the issue of the energy price, and he stressed it would be something to be discussed in private with the companies due to the commercial sensitivity of the issue.
The project was expected to cost "a couple billion dollars" and potential sites were already being investigated.
"What we really need is a close proximity to the transmission system and to the port so we are looking into lands and sites around that area," Mr Waipara said.
The shortlisted counterparties were now engaged in a request for proposal (RFP) process to identify business plans for the 600MW production facility in Southland.
The responses were due by mid-April and once they had been evaluated, the Southern Green Hydrogen team would determine whether there was a clear partner or partners to work with.
It was hoped to construction of the plant would start in the second half of the year, he said.
"The key thing, really, is to find a customer for the green hydrogen — that is probably the most important element and the one we are working through now."
