World Energy GH2 heads a consortium planning to invest $12 billion to construct a green hydrogen production plant and a wind farm to power the energy-intensive facility near Stephenville, a coastal town in western Newfoundland and Labrador.
It will position the company to become a leading player in Canada’s emerging clean hydrogen sector.
The proposed project has taken a major step forward following the signing of a historic agreement between Prime Minister Justin Trudeau and German Chancellor Olaf Scholz that calls for Canada to accelerate the development of green hydrogen exports to Germany.
“The Canada-Germany agreement on hydrogen is born out of a geopolitical and environmental imperative to accelerate the development and trade of clean energy among close committed democratic allies,” said Gene Gebolys, World Energy CEO.
“Canada is blessed with some of the best resources in the world and is home to a quarter of the world’s fresh water. It is 25 times larger than Germany with a population half its size. We are natural partners,” Gebolys said. “The time to act is now, the place to act is here.”
The Stephenville site was chosen by World Energy because it provides a deep sea port where hydrogen can be shipped and is located in a major wind corridor.
The green hydrogen plant is expected to go online in 2024 so exports of green hydrogen can start taking place in 2025, as called for in the Canada-Germany energy export agreement.
The deal follows on the heels of the Group of Seven Hydrogen Action Pact that Canada and Germany signed onto in May, in the wake of the Russian invasion of Ukraine and the impending cut-off of Russian energy exports to Europe.
The billionaire behind the deal
Project Nujio’qonik, as it is officially called, is largely the brainchild of billionaire businessman John Risley, the Halifax native who made his fortune as co-founder and head of Clearwater Seafoods. Based in Nova Scotia, Risley’s CFFI Ventures Inc. is one of the principal investors in the World Energy GH2 consortium financing the wind-hydrogen venture.
“We’re big users of hydrogen and we began some time ago looking at the prospect of finding green hydrogen and determined that it was an emerging industry and needs as its energy source green electricity,” said Risley in a July interview with CBC News. “And you only get green electricity from solar, hydro or wind.
“So rather than look around the world we looked in our own backyard and found out that, wow, the west coast of Newfoundland is a tremendous wind resource and that began the exercise that we’re embarked on now, which has manifested itself in this application to the government to proceed with the first phase on the Port au Port Peninsula and in the town of Stephenville.”
The company has committed to delivering 250,000 metric tons of green hydrogen per year to global markets once the Stephenville plant begins operations.
Producing hydrogen involves enormous energy consumption, however, and Newfoundland’s existing hydroelectric grid does not have the excess capacity to run the facility. Wind power would provide the solution to this energy gap.
Phase one of the hydrogen plant
The first phase of the clean hydrogen project involves the installation of 164 turbines along the Port aux Port Peninsula as part of a one gigawatt wind farm that will supply electricity to the hydrogen production plant.
Construction on the wind farm is set to begin early next year pending final approval from Newfoundland’s Natural Resources Minister Andrew Parsons, who is waiting for completion of an environmental impact assessment before he can give GH2 the green light.
Most observers expect approval to be granted given that Newfoundland and Labrador Premier Andrew Furey is firmly behind the project. The premier has stated this and other wind-to-hydrogen projects will not only spur job growth over the two years projected for the construction of the wind farm, but also contribute to supply chain spinoffs that will require additional staff for maintenance and operations.
“I’m not saying that this is a panacea, that (it’s) going to save Newfoundland and Labrador (but) this is the responsible move right now,” he said.
In the meantime, Risley has tried to dispel the fears of local peninsula residents of having their coastline blighted by rows of giant white propeller towers. Although the turbines will stand 200 metres tall, they will be separated by a distance of nearly one km and spread out over 50 kms, making the visual impact less obnoxious.
“The purpose of the environmental study that is underway as we speak is to identify where those impacts are the most likely to occur and what we can do to mitigate that impact. We don’t want to go in there and do all kinds of environmentally irresponsible things,” he said in an interview with CBC News.
He added: “This is, as I say, a national imperative and both governments would like to see this happen.”
The hydrogen project has received the backing of Katie Temple, executive director of the Western Environment Centre of Newfoundland, who believes the World Energy GH2 proposal will reduce reduce fossil fuel dependence.
Nevertheless, she expressed concern the approval process is “happening very quickly” following the lifting of the provincial moratorium on wind development in April.
Two more wind sites are needed
According the proposal filed by World Energy GH2 with the province, two additional wind farms will need to be built to make the energy project feasible.
Proposed sites in western Newfoundland include Bay St. George South, as well as the Lewis Hills and Blow Me Down Mountains.
Lewis Hills, a former Crown land reserve, is the proposed location of a UNESCO Global Geopark, however, and local environmentalists have objected to the plan.
“We will definitely want to develop the other two sites. The economies of scale will require that. And the feasibility work that we’ve done has been focused on the entire project, not just the first phase,” said Risley.
Risley expects to begin hiring construction engineers and other workers later this fall in advance of a possible February groundbreaking for the first of the turbines. A decision by resource minister Parsons on the World Energy plan is expected in September.