Fortescue and Argentina announce MoU for $8.4 billion green hydrogen investment

Australia’s Fortescue Metals Group has signed a memorandum of understanding (MoU) with the Government of Argentina which could pave the way for a US$8.4 billion green hydrogen hub in the South American nation.

The agreement between Argentina’s President Alberto Fernandez and Fortescue’s founder and chairman Andrew Forrest was reportedly discussed on the sidelines of the COP26 climate summit in Glasgow, which kicked off earlier this week.

Fortescue is looking to develop the large-scale project in the province of Río Negro with a view to producing green hydrogen on an industrial scale, which the government said would help create more than 15,000 direct jobs and further indirect jobs.

The $1.2 billion pilot stage aims to produce 35,000 tonnes of green hydrogen by 2022-2024, ahead of the $7.2 billion first production stage, which will generate 215,000 tonnes of green hydrogen – enough to power 1.6 million homes.

“It is expected to turn Río Negro into a global green hydrogen export hub by 2030,” the government said. “It is the most important international investment for our country in the last 20 years,” it continued.

Green hydrogen – a zero-carbon fuel made by electrolysis using renewable energy to split water into hydrogen and oxygen – is being heralded as a clean replacement for fossil fuels in industries otherwise hard to decarbonise, with the International Renewable Energy Agency forecasting rapid growth in coming years.

“We signed a MoU a few months ago and today we are talking about an investment of around $8 billion,” said the Latin America head of Fortescue Future Industries (the mining firm’s green energy unit), Agustin Pichot.

Fortescue Future Industries also signed a multi-billion pound green hydrogen deal with UK construction giant JCB and Ryze Hydrogen earlier this week.