Southern Green Gas Secures $2.2m order to develop Renewable Methane Demonstration Project

Key points
• Leading ASX-listed energy infrastructure company APA Group has contracted Southern Green Gas (SGG) to design, build and test a Renewable Methane Demonstration Project.
• APA will invest $1.1 million with the Federal Government’s Australian Renewable Energy Agency (ARENA) to provide an additional $1.1m in funding
•   Subject to successful outcome of demonstration project, SGG and APA plan to jointly develop commercial scale renewable methane projects
• SGG's renewable methane business plan represents a massive opportunity to develop a distruptive carbon neutral natural gas for major export markets
•   SGG's business plan could be the lowest and fastest route for Australia to develop a major export industry based on renewable hydrogen

Next generation renewable energy development company Southern Green Gas Limited (SGG) is pleased to announce it has secured $2.2 million to develop its ground-breaking renewable methane product.

SGG has entered into agreements with leading Australian energy infrastructure company, APA Group (ASX: APA), for the funding and development of a $2.2 million project to demonstrate the production of renewable methane.

Under the agreements, the project will receive $1.1 million in funding from ARENA, as part of ARENA's Advancing Renewables Program. APA will be the recipient of this funding, and will match the ARENA funding with a further $1.1 million. APA has contracted SGG to design, build and test the project.

The project is expected to take two years to complete, and will be located on APA land at the major Wallumbilla gas hub in southern Queensland.

Subject to the successful outcome of the demonstration project, SGG and APA intend to jointly develop commercial renewable methane projects. To facilitate this, SGG and APA have also entered into a Commercialisation Deed whereby APA will undertake the build-own-operate role, on an exclusive basis for ten years. SGG’s role will be to develop the projects, coordinate manufacture of process modules and secure customers for the methane.

Renewable Methane Process

The process combines renewable hydrogen, made from water and solar energy, with CO2 extracted from the air. The CO2 extracted from the air offsets the CO2 emitted when the methane is used, thereby making the whole energy system carbon neutral.

The process is modularised, to facilitate mass manufacture and therefore minimise component and production costs. The project will involve a module as shown diagrammatically below.

Commenting on the initiative, SGG’s Managing Director Rohan Gillespie stated:

“The reason we have chosen methane as the carrier for renewable energy is the ability to utilize the existing gas infrastructure system. The existing gas pipeline network allows us to access customers here in Australia, as well as export customers such as Japan and South Korea, through the existing liquefied natural gas (LNG) system. We believe renewable methane offers the best solution to creating a major new export industry for Australia, leveraging its globally competitive advantage in solar energy.

APA, being the owner and operator of most of Australia’s high pressure gas pipeline system, is the logical partner for SGG. We are delighted to be partnering with them.

We also acknowledge the important contribution from ARENA and its commitment to advancing renewable energy.”

The views expressed herein are not necessarily the views of the Australian Government, and the Australian Government does not accept responsibility for any information or advice contained herein.