Mr Taylor is identifying other locations for projects in key parts of Queensland where the Liberals and Nationals want to shore up support at the next federal election,including Mackay,Toowoomba and Townsville.
“It has been easy to say that the LNG industry has no role in the future of our energy system or energy systems around the world,but this is wrong,” Mr Taylor told a business forum on Tuesday.
“This is still a hugely important fuel source,not only for the direct supply of natural gas into customer markets but also in the role that it can play in decarbonising through the production of ammonia and hydrogen.
“Queensland’s gas supply,and the industry around that,will continue to be a very,very important one for many,many years to come.”
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Fortescue Metals Group chairman Andrew Forrestannounced $114 million last Sunday for a Gladstone project to produce hydrogen equipment,in a plan backed by Queensland Premier Annastacia Palaszczuk. He is also supporting apower station at Port Kembla in NSW that aims to produce electricity from hydrogen,although it will also use LNG in its early stages.
Greens leader Adam Bandt slammed the idea of giving the gas industry a pathway to producing hydrogen in the government’s updated technology investment road map,which is part of the climate policy package expected next week.
“Gas is as dirty as coal,so there’s a future for Australia in green hydrogen,which is produced from energy from the sun and the wind,but not hydrogen produced from gas and coal.
“There’s no need for more gas and it’s actively more harmful.
“And other countries won’t want to buy hydrogen produced from gas and coal – they’ll want green hydrogen. It’s not only going to make the climate crisis worse but it will leave us with stranded assets.”
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The gas industry is urging more support for “blue” hydrogen produced from gas,citingresearch from consulting firm EnergyQuest about the low cost of this form of hydrogen compared to the same product generated by electrolysis powered by wind and solar electricity.
“The greatest near-term potential for decarbonisation lies in blue hydrogen (hydrogen produced from natural gas with carbon capture and storage),rather than the much more expensive green hydrogen. Natural gas has a critical role to play in decarbonisation of the energy system,” EnergyQuest said in August.
The government climate policy aims to cut the cost of hydrogen to $2 a kilogram so it is competitive with fossil fuels,but there are questions about whether this price can be achieved with solar and wind power when it is already possible for “blue” hydrogen from gas.
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Australian National University researchers Thomas Longden,Fiona Beck and Frank Jotzo warned of the costs of “blue” hydrogenin a paper in March that said it would produce a lot of carbon emissions.
“At the moment,producing hydrogen with fossil fuels generally costs less than producing it with renewables-powered electrolysis. But the cost of electrolysis with renewable energy is falling,and could become cheaper than fossil fuel with carbon-capture options,” they said.
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