Fortescue inks MoU for green H2 supplies to Germany's Covestro

Australia’s Fortescue Future Industries (FFI) is gearing to sign a long-term deal to supply green hydrogen and its derivatives to German plastic materials maker Covestro AG (ETR:1COV).

The green energy business of Fortescue Metals Group Ltd (ASX:FMG) said on Monday it has sealed a non-binding Memorandum of Understanding (MoU) that paves the way to a formal agreement. The arrangement will see FFI deliver up to 100,000 tonnes of green hydrogen annually to its German partner to replace existing supplies of fossil hydrogen.

Three of the polymer producer’s facilities across Asia, North America and Europe will get the green hydrogen, starting as early as 2024.

The deal is expected to improve the sustainability of Covestro’s products and enable the company to lower its greenhouse gas emissions by up to 900,000 tonnes per year. It also aligns with its goal to switch to fossil-free alternative raw materials and renewable energies in its production.

“This is a ground-breaking collaboration which reinforces the power of green hydrogen to accelerate the decarbonisation of some of the most energy-intensive industries around the world,” said FFI’s chairman Andrew Forrest.

Perth-based FFI aims to expand its annual green hydrogen production to 15 million tonnes by 2030 and 50 million tonnes by 2040.

Choose your newsletter by Renewables Now. Join for free!