Fortescue given another month to take FID on Gibson Island green hydrogen plant or lose renewable power supply

Australia’s Fortescue has been granted a last-minute extension to keep hold of its provisional renewable electricity supply for its 550MW Gibson Island green hydrogen project in Brisbane, Australia.

Fortescue had originally signed a power purchase agreement with supplier Genex for 337.5MW of electricity from the yet-to-be-built Bulli Creek Solar project. But this contract came with the condition that a final investment decision (FID) on Gibson Island had to be taken at the end of 2023 and on the solar array by the end of 2024.

However, when Fortescue announced the first green hydrogen projects that had passed its board’s approval for FID in November 2023, Gibson Island was not on the list, nor highlighted as a project next in line. The Australian firm cited “structurally high green electricity costs” in Queensland.

At the time, Genex and Fortescue pushed back the deadline for FID on Gibson Island to 28 February 2024 and Bulli Creek Solar to 31 March 2025.

In an analyst call in January, Fortescue’s energy CEO Mark Hutchinson noted that the firm is in talks with both the federal and state governments in order to secure subsidies that would make the project financially viable.

However, Hutchinson also suggested that there would be a “go, no-go” decision made at a board meeting in February.

While there has been no update on whether the project will be shelved or not, the PPA with Genex has had its sunset dates further extended to the end of March this year for Gibson Island and end of April in 2025 for Bulli Creek Solar.

Genex is also in the midst of negotiations with other potential offtakers in order to increase the overall size of the first stage of Bulli Creek Solar to 775MW.