NeuRizer signs hydrogen production contract targeting Chinese market
Adelaide-based emerging urea producer NeuRizer (ASX: NRZ) has signed a two-year agreement with Meijin Energy Investment (Hainan) Co to produce hydrogen in China.
Under the terms of the deal, the two companies will enter into a joint venture to develop hydrogen at an initial two selected sites.
Meijin will pay NeuRizer a fee of A$38.32 million (US$25 million) per site to access its knowledge, intellectual property and patents.
An equity share for project participation will be finalised once assessments of site suitability are completed.
Following the assessments, Meijin will fund the construction of a Stage 1 demonstration facility and both companies will fund any commercial projects on a pro rata basis in accordance with their shareholding.
Rapidly developing market
NeuRizer chairman Justyn Peters said the agreement gives the company an opportunity to participate in China’s rapidly developing hydrogen market.
“The execution of this contract provides us with access to the Chinese hydrogen market through the newly-formed hydrogen energy platform and a trusted partner with access to a significant revenue stream,” he said.
“Project evaluation has already commenced and with travel restrictions lifted and the progression of the hydrogen economy in China, we are well placed to take advantage of the rapidly growing market.”
Meijin is a subsidiary of the Meijin Group which is the largest integrated hydrogen company in China and already constructs hydrogen vehicles, hydrogen fuel cells and hydrogen charging stations.
It is believed this will provide NeuRizer with a considerable advantage in meeting the needs of China’s rapidly developing hydrogen fuel market.
Successful Leigh Creek trials
During the pre-commercial demonstration phase, NeuRizer successfully produced large amounts of hydrogen at Leigh Creek.
The company confirmed that it can produce up to 200 million kilograms of hydrogen per year at Leigh Creek at a price of less than $1 per kilogram.
NeuRizer is confident it can replicate these volumes and prices in China.
In China hydrogen production costs range between $3-$5 per kg and retail for hydrogen varies between $7 -$10 per kg, giving NeuRizer a significant cost advantage.
Energy trading platform
China’s first hydrogen energy trading platform was launched in April by Shanxi Meijin Energy Co in collaboration with two other companies.
The platform aims to support one-stop trading in hydrogen energy products; create a closed loop of online business in the hydrogen industrial chain; and promote the inclusion of clean hydrogen energy into the voluntary emission reduction market.
It facilitates hydrogen production, sales, transportation logistics and digital tracking services, while providing online trading and settlement services for the nation.
The platform is jointly managed by Shanxi, Hundsun Technologies Inc and Qingshan Technology Co.
Hydrogen produced through this partnership can be traded on this platform, as well as being used by Meijin Energy in its operations.