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Plug Power and Fortescue evaluating hydrogen co-investment opportunities in North America

Plug and Fortescue have started the initial diligence process for Fortescue to take up to a 40% equity stake in Plug’s Texas hydrogen plant and for Plug to take up to a 25% equity stake in Fortescue’s proposed Phoenix hydrogen plant.

Plug Power, a provider of hydrogen solutions for the green hydrogen economy, is currently the preferred supplier of 550 MW electrolyzers to Fortescue, a global green energy and metals company, for Fortescue’s proposed Gibson Island Project, according to a news release.

Fortescue and Plug have signed a Memorandum of Understanding (MOU) to evaluate the potential supply of a range of capital equipment including electrolyzers, liquefiers, tanker trailers and stationary storage tanks for green hydrogen production projects in North America, including Fortescue’s proposed Phoenix hydrogen plant (30 metric tons per day (MTPD) phase 1; 120 MTPD phase 2). Both parties are also looking to collaborate on additional large projects on a global basis.

Under the terms of the MOU, Plug and Fortescue will also evaluate co-investment opportunities in green hydrogen production projects in North America. Plug and Fortescue have started the initial diligence process for Fortescue to take up to a 40% equity stake in Plug’s Texas hydrogen plant (45 MTPD) and for Plug to take up to a 25% equity stake in Fortescue’s proposed Phoenix hydrogen plant.

The proposed 550 MW (megawatt) PEM (proton-exchange membrane) electrolyzer supply contract for Fortescue’s green hydrogen production Gibson Island Project in Brisbane, Queensland, Australia, is subject to final negotiations and approvals and Fortescue’s final investment decision (FID) on that project. An FID is expected by the end of December 2023. Once operational, the plant is expected to produce approximately 385,000 [metric] tons of green ammonia a year from the green hydrogen produced onsite through the 550 MW hydrogen electrolysis facility.

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Hydro-Quebec drops 1.2bn green hydrogen project near Montreal

Hydro-Quebec has dropped out of a planned green hydrogen project for financial reasons.

Hydro-Quebec has dropped out of a planned $1.2bn green hydrogen project for financial reasons, according to a report in the Financial Post.

The item noted that, in order to keep the project viable, Quebec’s ministry of economy and innovation will invest an additional $284 million — bringing its total spend to $364 million — and that its strategic partners, Suncor Energy Inc., Shell Plc and Switzerland-based chemicals company Proman AG, would “contribute in an equivalent way to their current shareholding proportion.”

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OCI CEO: Blue ammonia as maritime fuel could hit $900 per ton

OCI executives today touted the prospects for their Texas blue ammonia plant, the only such project currently under construction in the US. They were discussing the company’s focus on decarbonizing growth opportunities following recently completed asset sales worth $6.2bn in net proceeds.

Prices for blue ammonia as a maritime fuel could come in at $900 per ton, a prospect that underscores OCI Global’s enthusiasm for its focus on decarbonizing energy transition projects.

OCI CEO Ahmed El-Hoshy made the remark today in discussing the company’s recently announced asset sales that will bring in roughly $6.2bn in net proceeds, which will be used to reduce debt, return value to shareholders – and make additional investments in energy transition projects.

The company launched a strategic review of its asset portfolio earlier this year under pressure from activist investor Inclusive Capital.

Announced Friday, OCI offloaded its 50% stake in fertilizer producer Fertiglobe to Abu Dhabi National Oil Company (ADNOC) in a deal worth $3.62bn. OCI and ADNOC separately announced they will explore opportunities for collaboration on joint venture investments in development projects in decarbonization and product distribution across North America and Europe. 

Today, OCI announced it has reached a deal to sell 100% of the equity interests in Iowa Fertilizer Company to Koch Ag & Energy Solutions for $3.6bn. OCI was advised by Morgan Stanley as financial advisor on the transaction and Cleary Gottlieb served as legal counsel.

Texas Blue

The company’s biggest investment globally is the 1.1 million ton Texas blue ammonia project, which is in development with partners Linde and ExxonMobil. OCI is in talks with Asian offtakers and other strategics about phase 1 offtake and a minority equity investment in that project. El-Hoshy also said previously the company is exploring adding a second line to expand production at the site. 

“Once the first line has some of that ammonia spoken for, that second line has the benefit of a lot of the utilities, the off-site being already in place, so that we’re talking about mainly inside the battery limit-type investments save for a few utility-type investments,” he said.

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Plug Power and Olin launch hydrogen production and marketing JV

Plug Power and Olin Corporation have launched Hidrogenii, a joint venture to provide green hydrogen throughout North America.

Plug Power and Olin Corporation have launched Hidrogenii, a joint venture to provide green hydrogen throughout North America, according to a press release.

Hidrogenii’’s first project will be a a 15 ton per day hydrogen plant in St. Gabriel, Louisiana.

Plug will be the exclusive marketer of the joint venture’s hydrogen and provide logistical support for delivery, while Olin, North America’s largest producer of electrolytic hydrogen headquartered in Missouri, will provide reliable hydrogen supply and operational expertise.

The Louisiana plant will benefit from state and local tax subsidies. It joins Plug’s growing national network of hydrogen plants in various planning and construction phases in New York, Tennessee, Georgia, Texas and California.

By 2025, Plug expects to produce 500 tons per day of liquid green hydrogen.

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Exclusive: Appalachian biogas firm seeking project debt

An RNG developer based in Appalachia with projects across the US is seeking project debt financing.

Northern Biogas, the West Virginia-based developer and operator of anaerobic digester and RNG facilities, is independently seeking debt for its project pipeline, according to two sources familiar with the matter.

Backed by HIG Capital, Northern Biogas serves diary, landfill, food waste and municipal projects. The company has raised some $200m in debt with assistance from alternative energy finance provider Pathward National Association, one source said. Project debt has typically been raised in tranches of $20m to $30m for individual projects.

Northern Biogas’ portfolio includes five dairy farm projects under construction in Wisconsin and one in Michigan, according to the company’s website. The company has a presence in Texas and Colorado as well.

Representatives of the company did not respond to requests for comment.
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Houston ammonia and hydrogen terminal on the block

The owners of a recently developed Houston terminal with proximity to ammonia, hydrogen, and nitrogen pipelines are working with an advisor on a sale process.

The owners of Vopak Moda Houston, a Gulf Coast hydrogen and ammonia terminaling asset, have hired an investment bank to run a sale process, according to two sources familiar with the matter.

Intrepid Investment Bankers has been retained to run the process, the sources said.

Vopak Moda and Intrepid did not respond to requests for comment.

Formed in 2016, Vopak Moda Houston is a 50/50 joint venture between Royal Vopak and Moda Midstream. Moda Midstream is a portfolio company of EnCap Flatrock Midstream, which did not respond to a request for comment.

In 2021 the JV commissioned its deepwater dock at the Port of Houston. It has constructed storage and terminal infrastructure for industrial gas product lines, with the stated intention of becoming a premier hydrogen and low-carbon ammonia terminaling hub in the Gulf Coast.

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Mobility solutions provider to raise up to EUR 200m

Quantron, the German and US-based mobility solutions provider, is set to launch a capital raise that could entail the sale of up to 20% equity.

Quantron, the German and US-based mobility solutions provider, is set to launch a capital raise that could entail the sale of up to 20% equity, according to three sources familiar with the matter.

The company is seeking between EUR 150m and EUR 200m in the process, the sources said, implying a valuation of up to EUR 1bn.

Quantron, which recently expanded into North America with the opening of an office in Detroit, will also consider debt as a part of the raise, one of the sources said.

At a ceremony at the Delegation of German Industry and Commerce (DGIC) in Washington D.C. on 12 October, Quantron signed a deal to supply TMP Logistics with 500 Class 8 trucks. The trucks will be operated by Quantron’s as-a-service (QaaS) vertical; they are scheduled for delivery in 2024.

Quantron AG CEO Michael Perschke told ReSource at that event that the company is in discussions with US investors about the capital raise, which has not formally launched but is tentatively scheduled to wrap up in 2Q23. Quantron is also in pre-closure discussions with several US law firms.

A fourth source said Quantron has worked with Danish consulting firm Ramboll Group on past deals.

Perschke said his company has relationships with PwC and EY, the latter especially on IPO readiness.

Quantron in September closed on a EUR 50m Series A with NASDAQ-listed Ballard Power Systems and German machinery manufacturer Neuman & Esser as investors.

Looking forward the company would like to work with a US strategic or private equity interest committed to hydrogen.

Utilities or corporates investing in hydrogen production but still building out the offtake structure would be of interest to Quantron, Perschke said. He noted that private equity interest like Ardian’s HY24 and Beam Capital are also active in the space.

Quantron is in the final stages of a deal with an oil company that Perschke declined to name, but said the company has 2,000 fueling stations across Europe that they are considering for conversion to hydrogen.

Perschke said his company plans to build out its presence in California and then could look for expansion in the northeast, Gulf Coast or Canada. The company aims to be an early mover in US hydrogen-fueled long-haul trucking along with peer Nikola Motor.

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