Frontier Energy Limited (ASX: FHE; OTCQB: FRHYF) (Frontier or the Company) is pleased to announce the appointment of highly experienced gas and power specialist, Equity Lifting Solutions Pty Ltd (ELS), to assist the Company regarding offtake negotiations for Stage One green hydrogen production from the Company’s Bristol Springs Project (the Project).
ELS’s highly regarded team has been instrumental in some of Western Australia’s largest energy offtake negotiations, most notably in liquefied natural gas (LNG) exports, Western Australian Domestic Gas usage (Domgas) and trucked LNG.
HIGHLIGHTS
- Equity Lifting Solutions has been appointed to assist the Company with offtake negotiations for Stage One green hydrogen production (4.4M kg per annum).
- Offtake discussions with priority targets are underway. These discussions will not be limited to end users of hydrogen through transmission and distribution pipelines, but also other participants in the energy industry.
- A potential pathway for Stage One offtake will be through the Dampier to Bunbury Natural Gas Pipeline (DBNGP) located 0.3km from the Project.
- The targeted hydrogen / natural gas blend for the DBNGP is 10%. Stage One production would contribute approximately 0.2% to this target.
Managing Director, Sam Lee Mohan commented: “ELS’s experience regarding offtake in the energy sector is exceptional and I’m delighted with the proactive approach they have taken to date.
ELS’s intimate knowledge of the Western Australia gas industry and the players involved provides invaluable intel. We not only want to ensure the strongest financial returns from these offtake negotiations, but also ensure we partner with a group for the long term, as we aim to grow the Project rapidly in the future.”
Equity Lifting Solutions’s Managing Director, Ken Chan commented: “Hydrogen is a core part of our industry’s rapid transition to low-carbon fuel sources. Frontier’s Bristol Springs green hydrogen project will play a critical part in this transition – being strategically located on the doorstep of significant energy demand in Western Australia’s South West and having access to the DBNGP and SWIS.
The Project’s ability to scale allows Frontier to maximise value for the local community and its stakeholders. We are incredibly impressed with the Frontier team’s progress on the project and look forward to bringing our 200+ years of collective LNG and Domgas commercialisation experience to the Project.”
Offtake discussion underway following advisor appointment
ELS will assist the Company with the identification of and negotiations with offtakers, with regards to both green hydrogen (4.4M kg per annum) and power purchase agreements (PPA) for excess solar energy (12MW pa).
ELS was selected due to their team’s vast experience in the energy industry, most notably their contracting and offtake discussions involving major Australian and International groups that produce gas from WA’s North West Shelf. Table 1 highlights recent clients and achievements.
Given the Project’s proximity to the DBNGP, 0.3km from the proposed hydrogen plant, both ELS and the Company agree the most likely pathway for Stage One offtake will be through the utilisation of this pipeline.
Image 1: DBNGP connection point located 0.3km from the Project
Offtake discussions have commenced with a select number of groups. These discussions are not limited to end users of hydrogen, through the transmission and distribution pipelines, but also other participants in the energy industry. The Company will continue to keep the market updated as these discussions progress.
Dampier to Bunbury Natural Gas Pipeline (DBNGP)
DBNGP is WA most significant gas transmission asset and provides natural gas to regional and metropolitan Western Australia. The DBNGP extends from Woodside’s Karratha Gas Plant, in the State’s North West to Bunbury, 170km south of Perth.
The owners of the pipeline, Australian Gas Infrastructure Group (AGIG), published a Study1 in January 2022, to identify a practical pathway to enable hydrogen to be blended into the DBNGP. A key outcome from the Study was to identify areas of the pipeline that are already capable of immediate blending of hydrogen (Image 2).
Image 2: Sections of the DBNGP identified as strong candidates for hydrogen blending2
The Study concluded that there is now a clear pathway for declaring a pipeline section as suitable for use with hydrogen/natural gas blends. It was found that mainline south, which extends from Kwinana to Bunbury, was an excellent candidate for hydrogen blending. A branching point connecting to this section of the pipeline is approximately 0.3km from the proposed hydrogen plant at the Project (Image 2).
The Study also assessed the potential to blend less than 10% of hydrogen into the pipeline. On a daily basis the DBNGP transports c.621TJ of natural gas. Stage One of the Project is forecast to produce (on average), 1.7TJ(e) per day.
Based on this, Stage One would provide approximately 0.27% of hydrogen energy into the pipeline, significantly under the targeted capacity.
About Frontier Energy
Frontier Energy Ltd (ASX: FHE; OTCQB: FRHYF) is developing the Bristol Springs Green Hydrogen Project (the Project) located 120km from Perth in Western Australia.
The Company recently completed a Pre-Feasibility Study1 that outlined the Project’s potential to be both an earlier mover and one of the lowest cost green hydrogen assets in Australia.
The Project benefits from its unique location surrounded by major infrastructure. This reduces operating and capital costs compared to more remote hydrogen projects, whilst also being surrounded by likely early adopters into the hydrogen industry in the transition from fossil fuels.
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