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Documents prepared by the Northern Territory government show so-called blue hydrogen requiring natural gas will play a significant role at the Middle Arm Sustainable Development Precinct on Darwin Harbour.
Key points:
- The NT government secured $1 million in federal funding for a feasibility study for the industrial precinct
- Documents show hydrogen at Middle Arm will predominantly be generated by natural gas
- Environmentalists say the project will primarily benefit the gas industry over greener energy
The undated plans for Middle Arm were obtained by the NT Environment Centre through Freedom of Information laws, and shared with the ABC.
The documents include three scenarios for developing the precinct on Darwin Harbour, two of which set aside land for the production of green and blue hydrogen. All three include the deployment of carbon capture and storage.
Green hydrogen is produced through renewable energy while blue hydrogen requires natural gas and the deployment of carbon capture and storage.
In the 'balanced scenario' of developing Middle Arm, blue hydrogen production is twice as large as green hydrogen production.
The NT government's plans were prepared for a pitch to the federal department of infrastructure for Commonwealth investment, with hopes that money could fund dredging of shipping channels and construction of jetties and wharves in Darwin Harbour.
On Wednesday, the NT government announced it had secured $1 million in federal funding to go towards a feasibility study for the industrial precinct, with the Chief Minister Natasha Fyles saying the development could support up to 20,000 jobs.
"We know we need to decarbonise, we know we need reliable energy as we step forward, and this is an exciting project that will be at Middle Arm," she said.
Ms Fyles reiterated that Middle Arm would be a "sustainable precinct" that would create manufacturing jobs and harness new technologies to provide energy both domestically and internationally.
The organisation tasked with conducting the feasibility study — Darwin Clean Hydrogen Hub — is jointly backed by gas giants Santos and Inpex, energy consultant group Xodus, and the CSIRO.
Environment Centre NT director Kirsty Howey said the documents showed the precinct was a "federal government funding of what is a massive expansion of the gas industry".
Blue versus green hydrogen debate
Hydrogen can be produced through water electrolysis, splitting water into oxygen and hydrogen, and can be entirely powered by renewable energy.
Reacting to the news of the feasibility study, Grattan Institute energy director Tony Wood said the Middle Arm Sustainable Industry Precinct had the potential to become a powerhouse for green hydrogen.
But he warned hydrogen produced from natural gas required sequestration of carbon, which he described as a "rubbish tip".
Mr Wood said government funding needed to be on renewable-based hydrogen.
"Anything the government puts public funding into should be about future-looking potential, not backward looking," he said.
"The risk of going down the natural gas route is that people get stuck there and never move forward."
But Inpex's general manager in the Northern Territory, Stuart Knowles, said there was a "massive opportunity" presented with carbon capture and storage.
He said the gas company was looking into methods to achieve its net zero by 2050 target.
"The industry is leading the reduction in emissions," he said.