Perth-based oil and gas firm Lion Energy (ASX: LIO) has signed an agreement with Australian property group Wagner Corporation Pty Ltd to explore opportunities relating to the development of green hydrogen facilities at Queensland’s Wellcamp Business Park and Pinkenba Wharf.
The agreement will allow the companies to look at collaborating on potential developments.
It follows a service agreement locked in with Queensland University of Technology earlier this week, whereby the university will assist Lion in applying its myGlobe software tool to optimise the location of potential green hydrogen infrastructure using geospatial data visualisation.
Both deals forms part of Lion’s green hydrogen strategy announced in April which the company hopes will position it “at the critical juncture” of resources, markets and technology.
As part of the strategy, it established a hydrogen advisory board and appointed experts to systematically analyse optimal electrolyser locations and technologies in Australia.
Executive chairman Tom Soulsby said the green hydrogen opportunity is “so big” that it would be a mistake to not seriously investigate the opportunities.
“While hydrogen is still in its nascent stages, volumes and revenue are expected to grow exponentially in the coming decade,” he said.
“Our 2021 direction provides a pathway for Lion to participate in the emerging low carbon-low emission energy transition.”
Storage and decarbonisation
Green hydrogen – made using renewable energy – is a clean-burning fuel which can be used for long-term energy storage and to help decarbonise transport, heating and industrial processes such as steel and cement making.
It is produced via electrolysis from sources such as solar, wind or tidal power and has been touted as the “holy grail” of renewables options as it is virtually emissions-free and able to cut around 34% of greenhouse gases from fossil fuels and industry at a manageable cost.
Green hydrogen can help achieve net-zero carbon dioxide emissions in energy-intensive sectors such as chemicals, long-haul transport, shipping and aviation, but production costs are currently too high to make it an economical option for all countries.
Growing scale in solar and wind energy is expected to drive the costs of green hydrogen progressively lower, which will in turn accelerate commercialisation.
Mr Soulsby said Australia could be an early mover in the green hydrogen space.
“Critically, Australia has a comparative advantage in renewable energy,” he said.
“Our abundant renewable resources position [us] to become one of the lowest cost green hydrogen producers, especially for the Asian market.”