A $750 million hydrogen facility is planned for Port Pirie after a deal was struck between the Marshall government and Trafigura, a commodities trading company that also owns Nyrstar.
- The SA government and Trafigura has co-funded $5m for an engineering study for a hydrogen facility
- The total cost of the project is expected to be $750m and will supply oxygen to Nyrstar and hydrogen to Trafigura
- The study is expected to be completed in 2022 with construction to start in 2023
The electrolyser would use the state’s wind and solar energy to split water, either from a desalination plant or from the smelter’s treated wastewater, into oxygen and hydrogen.
The oxygen will supply Nyrstar’s smelting operations, while the hydrogen will be sold by Trafigura to domestic transport and heavy industries or converted into ammonia for international export.
The SA government and Trafigura have also co-funded $2.5 million each towards a “Front End Engineering Design” study which was underway.
“The work that has been done already is actually incredibly optimistic and looks very positive for this significant project to move forward,” energy minister Dan Van Holst Pellekaan said.
Mr Van Holst Pellekaan said the work has given them good indicators about how much the parties will invest in the project but refrained from giving an exact figure until the engineering study was completed.
The first stage would involve an 85-megawatt electrolyser which would make it the largest electrolyser in the world according to Trafigura.
This would then increase to 440-megawatts in the second stage.
The facility will use wind and solar Energy from regional SA.
“Projects like Trafigura’s with the support of the South Australian and Federal Governments — will help South Australia achieve net 500 per cent renewable energy compared to current grid demand by 2050, as detailed in Our Climate Change Action Plan,” Mr Van Holst Pellekaan said.
“Our vision is a Renewable Energy Industrial Precinct in the Spencer Gulf – incorporating Port Pirie, Port Augusta, Whyalla and our world-class copper resources to support jobs for generations to come.”
Nyrstar’s vice president Dale West said around 150 to 300 jobs will be created during the construction while ongoing operations will provide between 10 and 25 permanent positions.
General Manager Tim Rogers said he welcomed the SA government’s commitment in accelerating the project and integrating it with the smelter was critical.
Labor opposition sceptical of ‘another planning study’
Shadow treasurer Stephen Mulligan said on the face of it, this looked positive, but Labor was committed to spending $590 million building a hydrogen plant.
“While today’s announcement looks like good news, the reality is that it’s just yet another planning study and work is likely years away from the state government’s announcement,” Mr Mulligan said.
Mr van Holst Pellakaan said they expected the engineering study to be completed next year followed by the financial sign-off.
He said construction is expected to begin in 2023.