Pure Hydrogen enters JV with CAC-H2 for Moreton Bay hydrogen hub
Pure Hydrogen expects construction to start later this year with the plant to become operational in 2024.
Australian clean energy company Pure Hydrogen (ASX: PH2) has announced a joint venture funding agreement with Singapore’s CAC-H2 to develop an ‘emerald hydrogen’ plant in Queensland.
The plant will deploy technology that produces hydrogen by converting woody biomass that would otherwise be burnt or dumped in landfill. Singapore-headquartered CAC-H2 is building waste-to-energy facilities with similar operations in other markets.
The companies have executed a convertible note purchase agreement that will see Pure Hydrogen initially fund 25% of the construction of the plant in Moreton Bay at a cost of around $3.2 million, with an option to fund a further 25% of the project at its discretion.
Pure Hydrogen is aiming to fast-track development to secure hydrogen offtake for supply to customers in southeast Queensland during 2024.
“With this funding, Pure Hydrogen is seeding what is likely to be the first of many plants located on the east coast of Australia,” Pure Hydrogen managing director Scott Brown said.
“We are creating a template that can be easily replicated across multiple sites and this will become evident as the year unfolds.”
Subject to approvals, the Moreton Bay hydrogen hub’s construction will start later this year with the plant expected to be operational and revenue-generating in 2024.
Funding terms
Under the agreement with CAC-H2, the notes will be issued in line with project requirements for an initial amount of $3.2 million, with an option for a further $3.2 million (50% of total costs).
Other terms of the convertible note include 12% interest rate payable on the notes per annum, and principal and interest accruing until the loan is either paid out or converted to shares.
The funds will be provided in tranches over the next 12 months and each note issued under the agreement will be secured by way of a general security deed.
Moreton Bay represents the initial facility in a proposed network of hydrogen energy hubs to be developed by the joint venture partners across Australia’s east coast.
CAC-H2 also has multiple projects in Australia and Asia for hydrogen production and green ammonia hubs for export.