Fortescue Future Industries (FFI) and Incitec Pivot Limited (IPL) will progress planning for the conversion of IPL’s Gibson Island ammonia facility to run on green hydrogen to its final stages, electing to commence front end engineering design as well as executing a framework agreement to govern the project through to a final investment decision, Fortescue Metals Group says.

With studies having confirmed its feasibility, the proposed project could see the construction of a new circa-500 MW hydrogen electrolysis facility at the site to produce green hydrogen as well as the retrofitting of IPL’s existing ammonia manufacturing facility to run on the green hydrogen produced on-site.

IPL’s Gibson Island facility will cease traditional fertiliser manufacturing early in the new year. As part of IPL’s decarbonisation strategy and in line with FFI’s goals to help heavy industry decarbonise, the Brisbane ammonia manufacturing and port facility conversion would be a world-first, Fortescue claims.

The two companies said last year they were partnering on a project to conduct a feasibility study to convert the ammonia-production facility to run on green, renewable hydrogen.

IPL Managing Director and CEO, Jeanne Johns, said the company was pleased to create a pathway to a more sustainable future for the Gibson Island ammonia manufacturing facility after traditional fertiliser production ceases.

By virtue of running on green hydrogen, the facility could ultimately produce up to 400,000 t/y of green ammonia, which can be exported to international markets as well as used in fertiliser or to help decarbonise local industry through its potential use as a low-carbon fuel source for ports, airports and heavy transport.

Front end engineering design (FEED) is a critical phase in development and will firm up technical specifications and cost, underpin procurement, as well as mature the project to final investment decision (FID), targeted for 2023. The FEED phase is anticipated to cost around A$38 million ($24 million), with the federal government, through the Australian Renewable Energy Agency, contributing A$13.7 million.

FFI CEO, Mark Hutchison, said around 100 jobs would be supported across the project in the lead up to FID, with first production, subject to FID, expected around 2025.

“Progressing this project into this final assessment stage is an important milestone in what will be a world-first conversion of an existing facility to become an industrial-scale producer of green hydrogen and green ammonia,” Hutchinson said.

“This collaboration aims to put Queensland and Australia ahead of the pack – not only in terms of the scale of production and supply of green hydrogen and green ammonia, but also in terms of demonstrating to the world that projects like this are feasible and that Australia has the foresight, the commitment, and the know-how to invest in and deliver them.

“We’re so pleased to have the support of a partner in IPL who are as invested as we are in developing real-world solutions to reduce our reliance on fossil fuels, and equally appreciate the support of the federal government who are a key enabler of us progressing the project to its final development phase.”

Johns said the announcement was a significant step forward for sustainability with IPL and FFI leading the global charge.

“The potential conversion of Gibson Island to green ammonia shows our commitment to pursuing opportunities to help create a more sustainable world in the new and emerging opportunities stemming from green ammonia,” Johns said.

“We are very pleased to be able to partner with FFI on what would be a world-first project, and I extend my thanks for the partnership and support from both the federal and Queensland governments.”

The parties are also working with the Queensland Government to understand how the project could benefit local energy markets and support the delivery of the Queensland Government’s Energy and Jobs Plan and broader development objectives.