Fortescue Metals Group, a leading Australian iron ore miner, has been actively pursuing green hydrogen gas as a key component of its decarbonization strategy. Green hydrogen means that no carbon dioxide gas is emitted in its production.
In May 2024, Fortescue launched its first US green hydrogen production project. It represented a $550 million investment in a facility to produce up to 11,000 tons of liquid green hydrogen annually. They renamed their green hydrogen facility in Buckeye, Arizona to Arizona Hydrogen. However, recent developments have forced them to scale back their green hydrogen plans.
The same is true for Woodside, citing a lack of renewable electricity, and for Origin Energy when it realised that it was uneconomical. Each company withdrew from the market for the same reason – the lack of cheap electricity – which ‘renewables’ cannot provide. You need hydrocarbon (coal, petroleum or natural gas) fired electricity generation for that.
Buying into the Climate Cult dream, Fortescue had set an ambitious goal to produce 15 million tons of green hydrogen annually by 2030. The company invested in renewable energy projects and developed its own green hydrogen technology, including the PEM50 project, a 50 MW green hydrogen electrolysis production plant.
But in July 2024, Fortescue announced a significant scaling back of its green hydrogen plans, citing high electricity prices as a major factor. The company put its goal of producing 15 million tons of green hydrogen on hold until electricity prices fall. (With these crazy Climate Cult plans that is like waiting for hell to freeze over.)
Additionally, Fortescue cut 700 jobs, affecting various parts of its business, including its green hydrogen operations.
You have got to love the irony there!
High electricity prices that have resulted from massive government (read ‘tax-payer’) subsidies to the green electricity sector are the reason Fortescue cannot produce cheap enough hydrogen gas from electrolysis. As I explained in Hydrogen Gas: Another Climate Cult Myth Busted the problem is basic physics.
And the dream of finding a pure source of hydrogen from a gas well is just that, more mythological than pink unicorns.
However mining magnate Andrew Forrest, Fortescue’s chairman, is unfazed and downplayed the job cuts, stating that they do not signal a retreat from the company’s green hydrogen ambitions. Forrest emphasized the importance of investing in renewable energy generation to drive down power prices, making green hydrogen production more commercially viable.
More dreaming! Or is it just wishful thinking?
Despite the scaling back, Fortescue remains committed to green hydrogen and its potential to decarbonize hard-to-abate sectors, such as iron ore operations. To extract the metallic iron from iron ore you need to use copious amounts of coal, and to make steel from that you need an enormous supply of both coal and electricity.
Solar and wind power just will not do it. It was coal and cheap electricity that got us out of the poverty of the dark ages. Why do they want to send us back there?
On October 2, 2024, Forrest said that it’s time to walk away from the ‘proven fantasy’ of net zero. That sounds like he is coming to see the light! Well, not quite it turns out. So, what did he mean by that?
Australian mining tycoon Andrew Forrest, founder and executive chairman of Fortescue, says it is time for the world to walk away from the “proven fantasy” of net zero emissions by 2050 and to embrace “real zero” by 2040 instead.
What? He is a true believer, a religious zealot, who believes despite the fundamentals of the underlying physics of the universe. Forrest continues:
“What they are really saying is that you can’t do it. And I’m saying to each of those chief executives and those political leaders who use the words ‘I can’t,’ OK, what about you get off the stage and let on a young girl [does he mean Greta?] or wiser leader who can. Someone with a bit of ticker because the technology is there,” he continued.
“We know the world can go real zero 2040 and I’m reaching out to the business people and politicians across our planet to say it is time now to walk away from this proven fantasy [of] net zero 2050 and adopt real zero 2040,” Forrest said. “We can, we must, let’s do it.” (My comments in square brackets.)
His own company is shutting down on green hydrogen because it is not economically feasible to produce hydrogen by electrolysis. Neither is it by the two methods that do it well – steam reforming and methane pyrolysis. All these methods are energy-intensive.
Currently, 95% of hydrogen fuel is “gray hydrogen” made from natural gas via the steam reformation process, but that method produces more carbon dioxide than burning an equivalent amount of petrol.
And by our current understanding of physics, the Climate Cult dream of mythical hydrogen gas mined straight out of the ground is just that. More mythology! It is a pain when you come up against the laws of physics and chemistry.
No amount of religious cries like “We can, we must, let’s do it” can change the laws of physics.
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