ISTANBUL

Australia announced $432 million Australian dollars ($283 million) in funding Friday to support green energy development by explosives manufacturer Orica, as part of efforts to expand renewable hydrogen production.

The project, known as the Hunter Valley Hydrogen Hub, will produce renewable hydrogen through electrolysis using recycled water and renewable electricity via a grid-connected 50-megawatt electrolyzer, Orica said in a statement.

Canberra aims to establish large-scale hydrogen production in the New South Wales Hunter region, specifically on Kooragang Island, according to the Australian Broadcasting Corporation (ABC).

The project was initially slated for construction in 2025 and operations by 2026, but it faced delays after partner company, Origin Energy, withdrew because of cost concerns.

“By replacing natural gas-derived hydrogen with clean, renewable alternatives, projects like Orica’s are helping to decarbonize core industrial processes,” said Australian Renewable Energy Agency (ARENA) Chief Executive Darren Miller.

Orica said the hydrogen produced will initially be used domestically to meet demand, with potential future exports under consideration.

Once operational, the hub is expected to produce 4,700 tons of green hydrogen annually, or around 12 tons per day. The hydrogen will gradually replace natural gas feedstock in the production of low-carbon ammonia and ammonium nitrate, used in agriculture, health care and other industries.

Climate Change and Energy Minister Chris Bowen said Australia is “one of the few countries in the world” capable of developing a large-scale green hydrogen industry suitable for export.

The hydrogen hub is scheduled to be operational in 2028.