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APA Group and Southern Green Gas to develop SNG projects in Australia

In Australia, renewable natural gas (RNG) project developer Southern Green Gas Ltd (SGG) has announced that it has entered into a Joint Development Agreement (JDA) with energy infrastructure and gas major APA Group to work together to develop renewable methane projects. A demonstration project is to be sited on APA land in Queensland (QLD).

An artist’s rendering of a solar-to-methane synthetic natural gas (SNG) production unit (image courtesy SGG).

The agreement requires the parties to work together to develop renewable methane projects. APA’s proposed role is to build-own-operate the infrastructure assets associated with the projects. Southern Green Gas’ role is project developer and seller of the methane gas.

Renewable methane can be made by using electrolysis to produce hydrogen using solar energy. Carbon dioxide (CO2) is extracted directly from the air. The hydrogen and carbon are then combined to produce synthetic methane (aka synthetic natural gas – SNG).

The carbon extracted balances the carbon emitted when the methane is used, therefore making the methane both renewable and carbon neutral.

Demo plant in Wallumbilla

The parties will initially work on a demonstration project, to be sited on APA’s land at Wallumbilla, near Roma in Queensland. On the site is located one of APA’s compressor stations, which will allow methane gas from the project to be injected into the gas pipeline system.

Subject to the outcome from the demonstration project and, ultimately, the signing up of customers for the end product, the parties intend to jointly develop a world-scale renewable methane project.

The agreement is non-binding and requires the parties to negotiate in good faith and use reasonable endeavours to conclude binding agreements.

The reason we have chosen methane as the carrier for renewable energy and especially renewable hydrogen is the ability to utilise the existing gas infrastructure system. The existing gas pipeline network allows us to access customers here in Australia, as well as export customers through the existing liquefied natural gas (LNG) system. APA, being the owner and operator of over 15 000 km of high-pressure gas pipelines in Australia, is the logical partner for Southern Green Gas. APA has already expanded into renewable energy generation from wind and solar, which is important as the majority of the renewable methane projects will be solar farms. We are delighted to be partnering with them, commented Rohan Gillespie, Managing Director, Southern Green Gas.

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