Hive Hydrogen South Africa is seeking to attract some of Japan’s biggest companies to invest in a $5.9 billion green ammonia project.
Senior officials from units of Mitsubishi UFJ Financial Group, Itochu, Mitsubishi Heavy Industries and Mitsui OSK Lines will visit the site of the proposed plant in Eastern Cape province next week to assess whether to lend it money or take equity investments, according to Hive Hydrogen. Officials from the International Finance Corporation and Japanese government agencies will also attend.
“This is the most senior delegation Japan has ever sent to South Africa” in terms of business investment, said Colin Loubser, Hive Hydrogen’s general manager in the city of Gqeberha, where the company plans to open the plant in 2029.
Hive Hydrogen, a unit of Hive Energy, is the biggest and most advanced of major projects to produce green hydrogen in South Africa. Advocates of the fuel say it has the potential to decarbonize heavy industry and shipping.
ArcelorMittal is considering a 69 billion South African rand ($3.7 billion) steel project that would use the fuel, while Sasol may develop a plant on the northwest coast if a new port is built.
While projects planned in neighboring Namibia are targeting exports to Europe, Hive — at least initially — is intending to sell much of its output to Japan and South Korea.
Officials from government agencies including the Japan Organization for Metals and Energy Security(Jogmec), the Japan International Cooperation Agency and the Japan External Trade Organization will also assess the project next week, Hive said.
Jogmec said it sends officials to projects to gather information, without being more specific. Mitsubishi UFJ declined to comment. Mitsui OSK and Mitsubishi Heavy Industries didn’t respond to requests for comment. Itochu signed a memorandum of understanding with Hive last year on developing the plant.
The IFC said it’s giving input on a dozen green hydrogen projects globally, without mentioning Hive.
The Hive plant envisages using the Ngqura deep-water port to ship ammonia — a more easily transportable derivative of green hydrogen — to export markets. A final decision is expected next year.
If it gets the go ahead, it will use 3,700 megawatts of renewable power generation capacity to split water to produce 1 million tons of hydrogen a year. That will then be converted into ammonia.
Hive has already approached oil majors and development finance institutions in Germany, Denmark and the Netherlands for funding, Loubser said.
The plant could, in theory, be quadrupled in size over time if demand materializes.
Ammonia is seen as a potential way to decarbonize shipping and heavy industry, and could also be used to fire power plants. While it’s currently more expensive to make than other fuels like diesel and so-called blue hydrogen that’s made using natural gas, costs may fall as technology improves and regulators impose penalties on the use of fossil fuels.
