Blue Energy to supply hydrogen to Stanmore Resources by converting pilot gas

Blue Energy Stanmore Resources ASX BLU SMR hydrogen offtake Bowen Basin
Blue Energy is investigating converting its pilot gas from the Bowen Basin to hydrogen and selling it to Stanmore.

Aspiring gas producer Blue Energy (ASX: BLU) has advanced hydrogen plans after executing a memorandum of understanding with Stanmore Resources (ASX: SMR).

Blue is evaluating the potential of converting pre-development gas to hydrogen.

Under the MoU, Blue will convert pilot gas that would otherwise be flared and supply it to Stanmore’s Isaac Plains Complex equipment fleet.

Blue noted converting the pilot gas to hydrogen instead of flaring it would reduce greenhouse gas emissions from its own activities.

This will also decrease Stanmore’s diesel fuel consumption, which would then minimise the carbon dioxide emissions from its mine fleet.

Proposed process

In order to do this, Blue is investigating off-the-shelf modular hydrogen generation portable equipment.

The company proposes to install the equipment either centrally or at the well head. The hydrogen would then be transported in purpose-built cylinders to Stanmore’s Isaac Plains Complex site for use in its fleet.

To undertake this, Blue is establishing technology partners.

With a foundation offtake agreement with Stanmore, the company says it is confident its hydrogen generation will be a “positive step towards lowering the greenhouse gas emission footprint of the Bowen Basin coal mining precinct.”

Building on earlier agreement

This latest agreement with Stanmore builds on an earlier MoU regarding the commercialisation of mine gas from Stanmore’s proposed underground operation adjacent to Blue’s wholly-owned ATP814 tenement in the Bowen Basin.

Blue and Stanmore are looking at developing a binding agreement that will involve capturing, processing and marketing of mine gas that would otherwise be a waste product.

According to Blue, this process will mitigate venting and flaring of fugitive gas emissions from Stanmore’s coal mine and help the industry meet emission targets.

The company also noted the capture of this methane gas would also improve mine safety.

Blue holds acreage and resources in Queensland’s Bowen, Surat and Galilee basins. It also has interests in the Northern Territory’s Wiso Basin.

ATP814 hosts a 2C (best estimate) contingent gas resource of 1,119 petajoules, and 3,248PJ of recoverable gas on a 3C (high estimate) basis.

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