Methane agreement to further the future of Australian renewables

by Tiffany Paczek
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Southern Green Gas has announces that is has entered into a joint development agreement with APA Group (APA). The agreement requires the parties to work together to develop renewable methane projects. APA’s proposed role is to build-own-operate the infrastructure assets associated with the projects and Southern Green Gas’ role is project developer and seller of the methane gas.

Renewable methane can be made by using electrolysis to produce hydrogen using solar energy. Carbon is extracted directly from the air. The hydrogen and carbon are then combined to produce methane. The carbon extracted balances the carbon emitted when the methane is used, therefore making the methane both renewable and carbon neutral.

The parties will initially work on a demonstration project, to be sited on APA’s land near Dalby in Queensland. On the site is located one of APA’s compressor stations, which will allow methane gas from the project to be injected into the gas pipeline system.

Subject to the outcome from the demonstration project and, ultimately, the signing up of customers for the end product, the parties intend to jointly develop a world scale renewable methane project. The agreement is non-binding and requires the parties to negotiate in good faith and use reasonable endeavours to conclude binding agreements.

Commenting on the agreement, Southern Green Gas’ managing director Rohan Gillespie states: “The reason we have chosen methane as the carrier for renewable energy and especially renewable hydrogen is the ability to utilise the existing gas infrastructure system. The existing gas pipeline network allows us to access customers here in Australia, as well as export customers through the existing liquefied natural gas (LNG) system. APA, being the owner and operator of over 15,000 kilometres of high pressure gas pipelines in Australia, is the logical partner for Southern Green Gas. APA has already expanded into renewable energy generation from wind and solar, which is important as the majority of the renewable methane projects will be solar farms. We are delighted to be partnering with them.”

The Southern Green Gas story

The electric car is here to stay. Now that some countries are committing to phasing out petrol and diesel cars by 2040, the fuel for these cars must be renewable to cut global emissions and improve urban air quality.

The preferred transport fuel for electric cars is hydrogen because it gives long distance driving range and is fast filling. However, historically the process of extracting or producing hydrogen from other sources has been costly and energy intensive. In addition, most hydrogen currently produced is from fossil fuels.

Until now, there has been no cost-effective way of making hydrogen renewable.

Southern Green Gas is developing renewable methane projects in Australia for domestic and export markets. Renewable methane, which can easily be converted into hydrogen at a customer’s site, is the preferred means to transport renewable hydrogen. It is potentially the lowest cost and can be delivered quickly to market because it uses the existing natural gas pipeline and shipping system.

Southern Green Gas’ low-cost approach for creating renewable methane involves three key sustainable features. Firstly, the energy source is Australia’s sunshine. Secondly, carbon dioxide is extracted from the air, balancing emissions when the fuel is used and making it carbon neutral. And thirdly, water is sourced from moisture in the air, avoiding any impacts on groundwater or surface water courses. The process is protected by patent applications.

The joint venture between Southern Green Gas and the APA Group will see the demonstration plant built on APA’s land starting in early 2019. APA has a compressor station on the site which will allow methane gas from the project to be injected into the gas pipeline system.

“The huge benefit of transporting renewable hydrogen in the form of methane is that APA’s existing natural gas pipeline system can be used to supply customers in Australia, and LNG ships will get our gas to 40 countries globally,” says Gillespie.

“Southern Green Gas aims to make renewable hydrogen at a competitive cost to petrol and diesel. And because it is renewable, there are no greenhouse gas emissions.

“With renewable methane having the properties of natural gas this fuel could also power households and industry as well as cars.”

Gillespie adds that the availability of renewable fuels at competitive prices could make Australia self-sufficient in transport fuels and open export possibilities with trading partners such as Korea and Japan. “These countries are encouraging hydrogen use and also have renewable targets – but they only have limited sources of renewable energy,” he says.

“We are currently seeking crowd-funding so we can start immediately on the first phase of the demonstration plant.”

Visit the crowd-funding page at

Image courtesy of Southern Green Gas.

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