BP acquires stakes in AREH
AREH could produce 1.6 million tonnes of green hydrogen or 9 million tonnes of green ammonia yearly.
BP today agreed to acquire a 40.5% equity stake and become the operator of the Asian Renewable Energy Hub (AREH), which has the potential to be one of the world’s largest renewables and green hydrogen hubs.
Based on the development of world-scale renewable power generation, AREH, in the Pilbara region of Western Australia, intends to supply renewable power to local customers in the largest mining region in the world and also produce green hydrogen and green ammonia for the domestic Australian market and export to major international users.
AREH plans to develop onshore wind and solar power generation in multiple phases to a total generating capacity of up to 26 gigawatts (GW) – the equivalent of producing over 90 terawatt-hours per year, around a third of all electricity generated in Australia in 2020.
At full capacity, AREH is expected to produce around 1.6 million tonnes of green hydrogen or 9 million tonnes of green ammonia per annum. Situated on a 6,500-square-kilometre site, AREH is already in a highly advantaged position with access to abundant solar and wind resources with consistent output.
The Pilbara is a globally competitive and energy-intensive mining region with substantial energy demand and carbon emissions. At full capacity, AREH is expected to abate around 17 million tonnes of carbon in domestic and export markets annually, equating to roughly 0.5 gigatonnes (Gt) of carbon savings over the project’s lifetime.
When fully developed, AREH could provide significant net renewable generating capacity for bp and make a material contribution to its strategic aim to capture a 10% share in core hydrogen markets globally.
First proposed in 2014, the AREH project has been developed to date by partners that currently comprise InterContinental Energy, CWP Global and Macquarie Capital and Macquarie’s Green Investment Group.
Under the terms of the agreement, bp will acquire a 40.5% interest in the project and will assume operatorship from 1 July 2022, subject to approvals. The other partner shareholders in AREH will continue to be InterContinental Energy (26.4%), CWP Global (17.8%) and Macquarie Capital and Macquarie’s Green Investment Group (15.3%).
Anja-Isabel Dotzenrath, bp’s executive vice president of gas and low carbon energy, said, “AREH is set to be one of the largest renewable and green hydrogen energy hubs in the world and can make a significant contribution to Australia and the wider Asia Pacific region’s energy transition.”
Frédéric Baudry, president of bp Australia, said, “This is an incredibly exciting development, and we are looking forward to working closely with our partners, InterContinental Energy, CWP Global, Macquarie Capital and Macquarie’s Green Investment Group, as well as the Nyangumarta people.”