A joint venture between Transitional Energy Group and UK-based renewable developer, Hive Energy, will develop a 3GW green ammonia project in Tierra del Fuego, Chile.
Tierra del Fuego is the famous archipelago right at the bottom of the South American continent, located along the Magellan Straits. The Gente Grande Project will thus benefit from an exceptional wind climate – wind speeds of up to 25 meters per second – with a large area of uninhabited flat land, deepwater port facilities, and quayside areas for production and storage facilities – overall a prime location for wind farms and centralized hydrogen and derivates production and export. Mirgor SACIFIA, a local company also plans to invest $200 million in some of the local ports in order to accommodate wind turbine imports.
Chile has a largely unexplored wind market in spite of its potential and the Tierra del Fuego region is yet to benefit from any wind turbines. But the wider intention of the archipelago’s governing body is to ramp up renewables and hydrogen production in order to shift away from fossil fuels. $6 billion was the key figure at the top of the case that Provincial Governor Gustavo Melella was trying to make for the region, a case which revolves around investment into renewable technologies.
With 20% of electricity generation coming from wind and solar, another 20% from hydro, 5% from biofuels and the rest from coal, natural gas and oil, the Latin American country still has some ways to go in order to achieve a net-zero status and then solely focus on export of clean electricity or clean fuels.
The plant is believed to have a capacity production of 1.3 million tons per annum, and a fairly open-ended scope for export with Asia, Europe and other American countries being targeted.
The recent $20 million obtained by the joint venture has been partially supported by new Middle Eastern investment partner, CCC. The sum of money will cover all the costs for the pre-construction phase of the project, including the environmental assessments which are already in progress, permitting and preliminary engineering, ensuring that construction can commence by the end of the year with a late 2024 operating starting point in mind. For Hive this marks its third project in the green ammonia space bringing its hydrogen pipeline to over 15GW. Project development is managed by TEG Chile who is responsible for all aspects of the project and supported by world-class technical partners such as Petrofac, Wood Group and ISP.
TEG has been scouting the region for a few years now and has pushed forward permitting applications for the whole site in August of 2022. The project is now engaging with offtake partners interested in securing a reliable low cost, high volume green ammonia supply option that can offer a competitive delivery price to almost any location.
Rethink has been banging the drum about Chile for a while now, having mentioned its potential in our latest flagship report titled ‘Annual Primary Electricity 3.0’, which has been released at the beginning of 2023 – a report that looks at the global electricity generation landscape and talks about the big winners of the energy transition.
The hydrogen industry in the country is still in an infantile stage with only 20MW of active electrolysis capacity, but more than 18GW of planned projects due to be turned on from 2025 onwards. And this is just the current pipeline. 2023 so far has been treating us to plenty green hydrogen projects that popped as if from nowhere so we would gladly bet on more news coming from not only Chile, but the entire continent of South America.