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Fortescue, Origin assess green ammonia, hydrogen plants in Australia's Tasmania

MELBOURNE (Reuters) - Fortescue Metals Group FMG.AX and Origin Energy Ltd ORG.AX announced on Tuesday separate plans to assess building ammonia export plants in the Australian island state of Tasmania, as both seek to tap opportunities in renewable energy.

FILE PHOTO: The logo of Australia's Fortescue Metals Group (FMG) can be seen on a bulk carrier as it is loaded with iron ore at the coastal town of Port Hedland in Western Australia, November 29, 2018. REUTERS/Melanie Burton

Origin will conduct a $3.2 million feasibility study on a greater-than-500-megawatt (MW) hydrogen plant that would produce more than 420,000 tonnes of zero-emission ammonia per year for local export markets, it said in a statement.

The study is expected to be finished by December 2021 and first production targeted for the mid-2020s, Origin said.

Fortescue is considering a 250-MW hydrogen plant with green ammonia production capacity of 250,000 tonnes per year, according to a statement.

Both projects are slated for construction at Bell Bay, about 41 km (26 miles) northwest of the city of Launceston.

Fortescue is targeting an investment decision by the board in 2021, the company said.

Fortescue founder and chairman, billionaire Andrew Forrest last week outlined plans for the miner’s wholly owned Fortescue Future Industries (FFI) unit to build a renewable energy business, aiming to compete with oil companies to provide low-cost green energy globally.

Already used in the fertiliser industry, ammonia is expected to play a role as a clean power source, potentially as a chemical store for excess renewable energy, and in the shipping industry as a fuel that only emits water and nitrogen.

One way of making green ammonia is through using hydrogen from water electrolysis and nitrogen separated from the air in a process powered by renewable electricity.

The plant has the potential to be one of the world’s biggest green hydrogen projects and will be powered by Tasmanian renewable energy, Fortescue said. FFI’s plans to have 235 gigawatts of installed energy capacity although did not provide a timeline.

Reporting by Melanie Burton; Editing by Christian Schmollinger

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