Minerals explorer QEM (ASX: QEM) has commenced studies into the development of green hydrogen opportunities at its flagship Julia Creek vanadium and oil shale project in north Queensland.
The studies will investigate financial and regulatory requirements for the company to produce hydrogen on-site at Julia Creek using a “green” solar-powered electrolyser.
It is envisaged the hydrogen would initially be used to support the energy needs of regional resources projects and ultimately for the hydrogeneration of raw oil from Julia Creek into transport fuels.
To assist in the assessment of capital and operating costs, QEM has appointed consultancy firm E2C Advisory Pty Ltd, which has extensive experience with electrolysers used for hydrogen production.
E2C previously assisted QEM with the review of a processing technology utilising a hydrocarbon solution for oil shale extraction.
QEM managing director Gavin Loyden said commissioning of the studies would take place amid a supportive policy environment led by the establishment of a ministry for hydrogen by the Queensland government in November.
“These studies will lay the groundwork to advance our green hydrogen strategy at Julia Creek, amid increasingly buoyant market conditions and an optimal resource profile to produce hydrogen on-site,” he said.
“Crucially, the [government’s] hydrogen strategy aligns with our broader strategic direction for Julia Creek, as [we] look to target the liquid fuels and renewable energy sectors.”
Julia Creek contains a vanadium resource of 2760 million tonnes (220Mt indicated and 2540Mt inferred) with an average vanadium pentoxide content of 0.30% and a 3C contingent oil resource of 783 million barrels.
The tenements form part of the Toolebuc Formation, which has been recognised as one of the largest deposits of vanadium and oil shale in the world.
The project is believed to be one of the single largest ASX-listed vanadium resources and represents a “globally significant” opportunity for development.
As the most abundant element on earth, hydrogen is a non-toxic colourless gas which can be extracted from other compounds by a chemical process.
The creation of hydrogen is considered green if renewable energy – such as solar panels or concentrators – is used to generate electricity for electrolysis of water, which creates zero carbon dioxide in the production process and may be used for transport, energy and other industrial purposes.
Hydrogen is a critical element for the hydrogeneration of oil and in July, QEM announced that test work utilising a hydrocarbon solution for oil shale extraction at Julia Creek resulted in oil yields of up to 181 kilogram per tonne – up 218% on that reported under Modified Fischer Assay (a standardised lab test for determining the oil yield from oil shale).
Mr Loyden said he did not expect pursuit of the green hydrogen strategy would have any material adverse impact on the development of the Julia Creek project.