South Korea-based SK Ecoplant Co., and Canadian renewable energy firm World Energy GH2 are set to build one of the largest green hydrogen facilities in the world after signing a collaborative partnership.
On Wednesday, SK Ecoplant announced plans to acquire 20 per cent ownership in the Newfoundland and Labrador Project Nujio’qonik facility from World Energy GH2, for USD$50 million.
The initial phase of the collaboration will involve the establishment of an onshore wind-power plant, an electrolysis system, and a facility capable of producing 360,000 tons of green ammonia annually.
The Korean company has also secured exclusive rights, valued at approximately US$1.5 billion, for the engineering, procurement, and construction of equipment for the Canadian facility.
Hydrogen production involves electrolysis, a process where an electric current is passed through water to separate hydrogen and oxygen molecules. To be classified as green hydrogen, the electricity used in electrolysis must originate from renewable sources.
SK Ecoplant has successfully established a comprehensive green hydrogen value chain, incorporating renewable energy sources such as wind power and electrolysis. Also, the company is involved in the development of a 2.6 GW offshore wind power project. Furthermore, SK Ecoplant’s subsidiary, SK Oceanplant, specializes in substructures for offshore wind power installation.
World Energy GH2 Inc. is a Newfoundland and Labrador-based renewable energy company while SK ecoplant is the environment and energy arm of SK Group, the second largest company in South Korea behind Samsung.
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Phase 1 will involve establishment of an offshore wind-power plant
The project’s primary objective is to generate green hydrogen, which will subsequently be transformed into ammonia for exportation to European markets starting in 2026.
“Newfoundland and Labrador is positioned to launch this industry in Canada and to be among the very few first-mover commercial producers of scale world-wide,” said Kyung-il Park, CEO, SK ecoplant.
“Project Nujio’qonik has world-class wind, abundant fresh water, a deep-sea port with close proximity to Europe, strong First Nations and community support, and support at all levels of government.”
John Risley, the chairman of World Energy GH2, noted that Canada is fostering a favourable investment environment that attracts substantial investments.
He acknowledged the country’s strong response to the US Inflation Reduction Act, which includes initiatives like the Canada Growth Fund, Investment Tax Credits, and Contracts for Difference. These innovative measures showcase Canada’s commitment to developing an industry that can effectively compete on a global scale.
The objective is to start producing green by March 2025, followed by green ammonia production the following year.
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