A collaboration agreement between Frontier Energy Ltd (ASX:FHE, OTCQB:FRHYF) and the Australian Gas Infrastructure Group (AGIG), will see an injection of an agreed percentage of hydrogen into the Mainline South section of the Dampier to Bunbury Natural Gas Pipeline (DBNGP) in Western Australia.
Hydrogen will come from FHE’s Bristol Springs Project which is just 120 kilometres from Perth. A definitive feasibility study (DFS) outlined the project’s potential to be both an earlier mover and one of the lowest-cost green hydrogen assets in Australia.
“We have been working with AGIG in relation to the injection of hydrogen from our Bristol Springs Project into the DBNGP. Formalising our relationship is an important step in the process of developing the hydrogen economy in WA,” FHE managing director Sam Lee Mohan said.
“Given our proximity to DBNGP, it is a win-win for all stakeholders and ensures we are a step closer to contributing to the State’s goal of delivering up to 10% hydrogen in the gas networks by 2030.
“The WA Government has been supportive of the green hydrogen industry however the current state of legislative frameworks and intended amendments requires acceleration.
"To have a tangible project located on a section of the DBNGP that is immediately available for hydrogen injection and working with the Government on legislative amendments will streamline and deliver the necessary change required to stimulate the green hydrogen industry.”
Hydrogen injection into major gas pipeline
AGIG owns the DBNGP, the major gas pipeline connecting the North West Shelf gas fields near Dampier. Its markets are principally in the South West of Western Australia and terminate at Bunbury.
AGIG and FHE will make joint submissions to the relevant WA Government departments in relation to this hydrogen injection.
A feasibility study published by AGIG in Q1 2022 found the pipeline adjacent to the Bristol Springs Project (Mainline South) is already capable of injecting up to 9% hydrogen (by volume) without any major modifications. Mainline South is the main trunkline between Kwinana and Bunbury.
The study was partially funded by the WA Government with a grant of $216,000.
Mainline South and its associated lateral pipelines are “immediate candidates” for accepting hydrogen, subject to the installation of some supplementary gas analysis equipment and reconfiguration of flow computers, supervisory control and data acquisition system and gas accounting systems.
Stage one of the project would account for less than 1% hydrogen to the DBNGP based on an average minimum daily flow, when gas flows are at least 250 TJ/day occur.
Notably AGIG and Frontier intend to enter discussions as to the type of arrangements that may be put in place to allow injection of an agreed percentage of hydrogen into the DBNGP and will work together to undertake a FEED Study for the injection facility and hydrogen blending station.
Discussions are happening as state and federal governments look to work together to amend gas laws.
National gas laws changing
Governments will amend national gas laws and regulations to bring hydrogen blends, biomethane and other renewable gases under the national gas regulatory framework. Amendments are expected to be completed in early 2024.
Map of the project's location and relation to the DBNGP.
As WA’s most significant gas transmission asset, which provides natural gas to the State, the DBNGP will play a critical role in the new framework.
A possible connection point to the DBNGP is less than 300 metres from the proposed hydrogen plant location, where the DBNGP branches off to provide gas to Alcoa (NYSE:NYSE:AA)’s Wagerup Alumina Refinery.
Hydrogen blend supply to increase
AGIG is the leading group in Australia blending hydrogen with natural gas and has positioned itself at the Tonsley Innovation District in Mitchell Park, Hydrogen Park South Australia (HyP SA), an Australian first project that produces renewable hydrogen gas.
Hydrogen Park South Australia (source: AGIG).
HyP SA started production in May 2021 and delivers a 5% renewable gas blend to more than 700 gas customers in Mitchell Park. HyP SA demonstrates renewable hydrogen production and blending technology in an Australian context. Its 5% hydrogen blend is a step towards lowering greenhouse gas emissions on Australia’s networks.
AGIG also supplies to industry via tube trailers (long storage tubes on the back of semi-trailers) and aims to supply the transport sector in the future.
In March 2023 AGIG extended the project area to include a further 3,000 gas connections including households, businesses and schools.
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