Provaris Energy Ltd (ASX:PV1) has cut the ribbon on a concept design study for its proposed green hydrogen project in the Tiwi Islands.
The Tiwi H2 Project is designed to export 100,000 tonnes of green hydrogen every year from 2027 over a 30-year mine life, and this concept design study lights the fuse for future development.
Now, Provaris can move ahead with work to inform front-end engineering and design (FEED)-level technical, commercial and economic studies and consider financing options.
Importantly, the study reinforced several observations and outcomes from Provaris’ 2021 compressed hydrogen chain scoping study, meaning last year’s vision remains consistent with the concept that’s taking shape.
Equipping Provaris for next steps
Speaking to the work, Provaris managing director and CEO Martin Carolan said completing the concept design study was “a significant milestone” for the company.
“The continued development of the Tiwi H2 Project demonstrates our confidence of the project’s suitability and competitiveness as a compressed hydrogen production and export project,” Carolan explained.
“Completion of the study enables Provaris to enter informed discussions with interested third parties about hydrogen offtake and development alternatives, including investment in or ownership of the upstream generation and hydrogen production or investment at the overall project level.
Potential first-mover advantage
Provaris’ executive director and chief development officer Garry Triglavcanin continued: “Together with the lodgement of the EPA Referral, the study delivers a detailed base case for the Tiwi H2 project to progress to further Munupi permissions, and then into the permitting, approvals and pre-FEED for a staged development of a fully integrated green hydrogen project, with a target export volume of 100,000 tonnes per annum level over 30 years.
“The combination of low environmental impact, port infrastructure, proximity to market and compression provides Provaris and the Tiwi H2 Project with a potential first-mover advantage in the region, by targeting first exports in 2027, and has the potential to be Australia’s first export project of gaseous green hydrogen.”
How does Tiwi H2 stack up?
For Provaris, Tiwi H2’s appeal is all about location, location, location.
The company’s concept design study indicates that the solar intensity on the Tiwi Islands is competitive enough to support a solar farm and battery system.
What’s more, the project’s proximity to the South-East Asian energy markets will save on delivery costs, while the existing port and land access is piqued to curb development time and construction capital.
All up, the project is expected to take between US$4.5 to US$5.2 billion to get off the ground, while roughly 70% of this capital cost is not related to compression.
The Tiwi H2 Project will use a fleet of Provaris’ proprietary H2Neo GH2 carriers to distribute green hydrogen into the South-East Asian markets, with the engineering and final class approvals on track for 2023.
There’s also scope for the project to generate around 500 construction jobs and roughly 100 operational roles.
On the environmental side, the 100,000 tonnes of green hydrogen exports targeted each year could offset around 900,000 tonnes of carbon emissions per annum across power generation, mobility and industrial applications.
What’s next?
In October, Provaris plans to engage a lead engineering group and make a decision on whether to proceed to the pre-FEED development stage.
Solar monitoring and hydrogen offtake and investment discussions are also poised to commence this year, while Provaris will look to appoint a project financier and EPC contractor in 2023.
A final investment decision is targeted late next year, paving the way for first hydrogen exports in 2027.
Provaris will keep the market abreast of any developments as it takes the magnifying glass to the Tiwi H2 Project.