Worley Secures FEED Contract for Hydrogen and Methanol Venture in Tasmania

Australia's ABEL Energy has entered into an agreement with Worley for the front-end engineering design (FEED) contract for its ambitious A$1.7 billion ($1.116 billion) green hydrogen and methanol project located at Bell Bay in Northern Tasmania. The comprehensive agreement empowers Worley to oversee the entire spectrum of the project, encompassing design, engineering, procurement, and construction services until the final investment decision (FID).

The Bell Bay project is strategically designed to leverage 240 MW of renewable energy for water electrolysis, a process that generates green hydrogen. Subsequently, this green hydrogen will be amalgamated with carbon derived from a biomass source to produce green methanol. The initial phase, focused on the FEED stage, is projected to span 12 months. The facility is slated to initiate green hydrogen production by 2028, with the primary objective of supplying input for the production of 300,000 tons of green methanol annually, catering primarily to the shipping industry.

ABEL Energy underscored the strategic importance of the Bell Bay project, emphasizing its role in meeting the sustainability goals of major shipping companies such as Maersk and CMA CGM. These industry giants are increasingly investing in large new containerships designed to operate on green methanol, a move aimed at reducing the greenhouse gas intensity of their cargo businesses. Leveraging green methanol from the Bell Bay project as a fuel source is expected to enable these companies to steer clear of emitting over 540,000 tons per year of fossil fuel CO2 into the atmosphere.

Mark Accadia, Worley Location Director for Australia East, PNG & Mongolia, articulated the anticipation of applying Worley's global expertise across the entire e-methanol value chain to support this flagship project. In alignment with ABEL and pitt&sherry, Accadia conveyed excitement about contributing to sustainable change within hard-to-abate industries. The collaborative effort is poised to drive advancements in emerging fuels, marking a significant pillar in the strategic delivery to the energy sector.

A noteworthy milestone leading to the current phase of the project was the term sheet signed in the summer of 2023 between Hydro Tasmania and Bell Bay Powerfuels. The agreement involved the sale of the decommissioned Bell Bay Power Station, earmarked as the designated site for the Bell Bay project. ABEL Energy highlighted that the selection of this site played a crucial role in expediting the development of the project, adding a layer of strategic advantage to the initiative.

The collaboration between ABEL Energy, Worley, and pitt&sherry represents a significant stride towards realizing the Bell Bay green hydrogen and methanol project. The alignment of expertise, vision, and strategic goals positions this initiative as a transformative force in the pursuit of sustainable energy solutions. As the project advances through the FEED stage and beyond, it is poised to contribute substantially to the broader objectives of the energy sector and the emerging landscape of green fuels.