Eneos, Origin Energy to develop Japan-bound hydrogen supply chain in Australia

Eneos Corporation (Japanese petroleum and metals conglomerate) and Origin Energy (an Australian energy company) agreed to explore a potential collaboration for a clean hydrogen supply chain between Japan and Australia.

Under the study, both partners will jointly assess the potential of affordable hydrogen produced by using renewable energy in Queensland. Origin will focus on the use of renewable energy supply and water electrolysis cells for hydrogen production.

Eneos will be responsible for the more efficient production of methylcyclohexane (MCH) and maritime transport of MCH as a form of hydrogen storage and transportation from Australia to Japan. It will also store and conduct dehydrogenation of MCH at its refineries and supply hydrogen for industrial use at nearby thermal power plants, steel refineries, etc. It will also use its existing petroleum-related infrastructure, including tankers, storage tanks and dehydrogenation facilities for enabling hydrogen supply chain. Toluene separated in the dehydrogenation process is returned to Australia for repeat use as a raw material in MCH production.

The two companies will explore opportunities to access government support, including the Green Innovation Fund in Japan and the hydrogen hub project in Australia, to achieve the early development of a green hydrogen supply chain between Japan and Australia.

Queensland state government is promoting hydrogen industry development leveraging these renewable energy sources. The state government has launched various programs, including establishing the Hydrogen Industry Development Fund to support hydrogen business and develop areas dedicated to large-scale hydrogen business across the state. Furthermore, the existing infrastructure such as storage tanks, shipping and port facilities which is being used for coal and natural gas can be employed for hydrogen export.

Australia has excellent potential for cost-competitive hydrogen production given its favourable climate conditions, including wind and sunlight, and expansive land. In its latest outlook report, the Australian Energy Market Operator (Aemo) said that  Australia is likely to produce hydrogen from grid-connected electrolysers in 2024-2025 and can satisfy around 17% of total power demand.