At close of trade today, shares in the energy supplier were changing hands at $4.69 – up 0.64%. Similarly, the S&P/ASX 200 Index (ASX: XJO) finished the day 0.66% higher.
Let’s take a closer look at today’s announcement.
Origin share price in the green
The Origin share price increased at a slightly lower rate than the general market today. That’s despite today’s news that Origin and Kawasaki Heavy Industries Ltd have signed a memorandum of understanding (MoU) with the Queensland Government-owned Port of Townsville.
The MoU covers a “300MW early export project that would produce 36,500 tonnes per annum of green liquid hydrogen using renewable energy and sustainable water”. In the statement, Origin said it expects the first liquified hydrogen exports from the port to begin in the mid-2020s.
Work will now commence on accommodating Kawasaki’s semi-commercial scale liquid hydrogen carriers at the port. As well, the statement advised the three parties are considering ways of sharing infrastructure with other users at the Port of Townsville.
What is green hydrogen?
Green hydrogen is the process that separates hydrogen molecules from water. This is achieved using a process known as electrolysis. Electrolysis is when a strong jolt of electricity (generated with solar panels) is zapped into a tank of water, separating the hydrogen molecules from the oxygen ones. The hydrogen is then liquified for export and use in power generation.
The process involves zero emissions, hence the ‘green’ moniker. Many ASX shares involved with greener energy production, such as lithium miners, have boomed over the past year as the world transitions to less reliance on fossil fuels. Shareholders will no doubt be hoping the company’s continued involvement with green hydrogen will bode well for the Origin share price.
Origin Future Fuels general manager Felicity Underhill said of today’s news:
Townsville is ideally placed to develop a liquid hydrogen facility due to its deep-water port, industrial-zoned land, availability of skilled workers and nearby renewable energy and sustainable water resources.
There will be significant export demand for green hydrogen coming from Asia in the 2030s and even sooner from Japan in the mid-2020s and our proximity to these markets and abundance of clean renewable resources puts Australia in pole position to be a global leader in hydrogen.
This is one of the most advanced commercial scale green liquid hydrogen projects in the world, and we and our partners are looking forward to commencing front end engineering and design (FEED) this calendar year.
Origin share price snapshot
Over the past year, the Origin share price has depreciated by almost 10% and has fallen by 1.47% since the beginning of this year. Competitor AGL Energy Ltd (ASX: AGL) has seen its value fall by 47% over the last 12 months.