Strike Energy Looks at Green Hydrogen for Project Haber (ASX:STX)

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The Strike Energy Ltd [ASX:STX] shares are up today after announcing it has signed separate non-binding memorandums of understanding (MOU) with ATCO and Infinite Blue Energy to source green hydrogen for their Project Haber.

Project Haber is a 1.4 million tons per year urea fertiliser production facility that Strike is planning to build in Geraldton, Western Australia.

Strike is looking at powering the project in the beginning through a 10MW electroliser, which will be located on site. Once it starts operating, Project Haber is set to produce 1,825 tons of green hydrogen a year, the equivalent of around 2% of the plant’s total hydrogen feedstock.

Yet Strike plans to increase Project Haber’s demand for green hydrogen over the next years. By 2033, when Strike estimates costs for green hydrogen will fall below $2 a kilo, Strike reckons the project’s demand for green hydrogen will be at over 30%. That’s why Strike is looking at collaborating with ATCO and Infinite Blue Energy on infrastructure and supplying green hydrogen for the project.

Project Haber is designed to produce and consume 141,000 tons of hydrogen a year, which Strike says presents a great long-term and growth opportunity for green hydrogen suppliers…and Australia’s budding hydrogen market.

As Stuart Nicholls, Strike’s CEO and Managing Director, said:

Progression of these MOUs with two of the key green hydrogen developers in the Mid-West is a great step in accelerating the WA hydrogen economy.

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Project Haber is also set to become a carbon sink

You see, as time goes on, the project will not only need more green hydrogen, but also more carbon dioxide to function, as you can see below.

Potential Project Haber Green HydrogenSource: Strike Energy

Once it gets past 40% of green hydrogen demand it will need to start importing carbon dioxide from other industries to keep making urea fertiliser.

The estimate is that it will need around 500 kpa of CO2 by 2044.

As Nicholls continued:

Incorporating green hydrogen in Project Haber’s urea production process will enable Strike to produce some of the lowest carbon urea possible and potentially create one of Australia’s largest carbon sinks, moving Strike into carbon negative territory.

Strike shares slightly up

At time of writing, Strike’s shares are up 1.72% after the announcement, trading at 29.5 cents.

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Selva Freigedo,
For Money Morning

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About Selva Freigedo

Selva Freigedo is an analyst at Money Morning. She has a background in financial economics, but what makes Selva´s experiences different to many are the places she has lived and worked. Born in Argentina, she has also lived in Brazil, the US, Spain, and now Australia. She has seen up…

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