Oil and gas major BP has agreed to acquire a 40.5% equity stake in the Asian Renewable Energy Hub (AREH) and become the operator of one of the world's largest renewables and green hydrogen energy hubs based in Australia.
The project, located in the Pilbara region of Western Australia, expects to supply renewable power to local customers in the world’s largest mining region and also to produce green hydrogen and green ammonia for the domestic market and export to major international users, London-based BP says in a statement.
The AREH also has plans to develop onshore wind and solar power generation in multiple phases with a total generating capacity of up to 26 gigawatts – the equivalent of producing over 90 terawatt hours per year, which is around a third of all electricity generated in Australia in 2020.
Anja-Isabel Dotzenrath, BP’s executive vice president of gas and low carbon energy, says: “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. It truly reflects what integrated energy is – combining solar and onshore wind power with hydrogen production and using it to help transform sectors and regions. It will also serve as a long-term clean energy security contributor in Asia-Pacific, helping countries such as South Korea and Japan to decarbonize."
First proposed in 2014, the AREH project, which is expected to start producing power by 2027, is currently being developed by a consortium of energy firms including green fuels company InterContinental Energy, CWP Global, Vestas and Macquarie Asset Management’s Pathways Investments.
In January 2022, Singapore’s sovereign wealth fund GIC announced it had taken a strategic equity investment in InterContinental Energy. GIC says the firm’s green hydrogen ambitions align with its continuing steps in supporting green innovation and the broader energy transition.
According to BP, the latest deal supports its determination to become a net zero company by 2050 or sooner. The goal covers the greenhouse gas emissions from its operations worldwide, currently around 55 million tonnes of CO2 equivalent (MteCO2e) a year, and the carbon in the oil and gas that it produces, equivalent currently to around 360 MteCO2e emissions a year, both on an absolute basis.