As the prognosis for demand for green hydrogen improves, Fortescue Metals Group Ltd. will increase its investments in manufacturing facilities.
According to Mark Hutchinson, CEO of Fortescue Future Industries, a factory now being built in Australia to produce electrolyzers—equipment needed to make hydrogen—won't be able to keep up with the growing demand for zero-emissions fuel.
In an interview Friday in Canberra, he added, “We'll announce some major investments in several plants over the coming few months.” The project in Gladstone, Queensland, which had a two-gigawatt starting annual capacity when it was announced last year, “is going to be too little because the demand is going to be immense.”
Former General Electric Co. executive Hutchinson was chosen by Fortescue founder Forrest to lead the company's clean energy division's drive to become a major exporter of green hydrogen, with a goal of producing 15 million tons of the substance annually by 2030.
According to him, the facility anticipates starting to produce green hydrogen in 2024 at a modest rate of a few hundred thousand tons before swiftly ramping up to reach its 2030 target. Future supply agreements have been announced by Fortescue with organizations including the UK's JC Bamford Excavators Ltd. and Germany's E.ON SE.
In a statement made on the margins of a jobs and skills meeting organized by the government, Hutchinson stated, “When I think about how enormous this market is, it's as big as replacing the whole fossil fuel industry in the globe, and it's real today.”
Forrest informed investors earlier this week that investment managers had approached him for a potential $20 billion standalone offering of FFI, but the company contends that keeping the hydrogen developer together with the No. 4 iron ore exporter in the world would be more advantageous.
According to Hutchinson, “it's massive once we get going at scale and simply looking at the projects we have.” According to him, reaching the output goal for 2030 will result in an “energy industry that is considerably greater than the iron ore business.”
After the miner revealed a 40% decline in full-year earnings last month, analysts questioned Fortescue's expenditure on the green segment. According to documents, the corporation may dedicate up to $700 million to the hydrogen unit during this fiscal year, with the majority of that amount going toward operational expenditures.
