Worley wins FEED contract for hydrogen and methanol project in Tasmania

Australia’s ABEL Energy has awarded compatriot Worley with front-end engineering design (FEED) work for its A$1.7 billion ($1.116 billion) green hydrogen and methanol project at Bell Bay in Northern Tasmania.

Under the agreement, Worley said the company will design and engineer the facility, while also providing procurement and construction services through to the final investment decision (FID). Moreover, Worley noted it will work with local Tasmanian engineering company pitt&sherry to tailor its delivery approach to the unique considerations of the region.

According to ABEL Energy, the Bell Bay project will use 240 MW of renewable energy for water electrolysis to produce green hydrogen, which will then be combined with carbon from a biomass source to produce green methanol.

The expected run time for the FEED stage of the project is 12 months, with the facility scheduled to commence green hydrogen production by 2028, mainly as an input for 300,000 tons of green methanol per year for the shipping industry.

ABEL pointed out that shipping majors like Maersk and CMA CGM are ordering large new containerships capable of running on green methanol so that they can reduce the greenhouse gas intensity of their cargo businesses, adding that using green methanol from Bell Bay as a fuel will enable the companies to avoid emitting over 540,000 tons per year of fossil fuel CO2 into the atmosphere.

Rhys Tucker, Energy Chief Technology Officer at ABEL Energy, commented: “We are very pleased to have appointed Worley and pitt&sherry to deliver the front-end engineering design for our flagship project. We already have a strong and collaborative working relationship and we have every confidence that together we will deliver an exceptional project.”

Mark Accadia, Worley Location Director for Australia East, PNG & Mongolia, said: “We look forward to applying Worley’s global expertise across the entire e-methanol value chain to support this flagship project. Together with ABEL and pitt&sherry, we’re excited to progress sustainable change across hard-to-abate industries.”

Dean Comrie, pitt&sherry CEO, added: “pitt&sherry is proud to continue our support of ABEL Energy’s Bell Bay Powerfuels Project. Working with Worley on this important next stage of the project will see our combined capabilities help accelerate the energy transition and the future of emerging fuels, a key pillar in our strategic delivery to the energy sector.”

To remind, in the summer of 2023, Hydro Tasmania and Bell Bay Powerfuels signed a term sheet for the sale of the decommissioned Bell Bay Power Station, set to be used as a Bell Bay project site, with ABEL Energy noting at the time that the site selection accelerates the development of the project.