Sorry mac, I'm pretty clunky when it comes to science. I asked Copilot and it returned the following
below, but perhaps I didn't ask the question correctly? One of Copilots' references is a calculator, so maybe you can determine your answer from there? The link is below, and I have screen printed it below.
Re: profitability; first the science needs to be proved which I suggest has been, but then it needs to be leveraged for profitability which these projects are attempting to do. Think of it as R&D, in this case you are correct, a large investment in R&D is required before determining whether profitability is achievable. There are counter perspectives to that as has been discussed here previously. eg. maybe if we do not change our business practices we will lose our right to mine or it becomes uneconomic due to CO2 penalty payments. Time between the science and profitability is required. In my opinion there will be many niche avenues to various business lines in the aim for profitability and new business'. Some of them could be building electrolysis machinery for sale, consulting out our technical and organisational knowledge, licensing our IP, none of these things would be entertained at the start, but as these projects gather knowledge expertise and milestones, business' and profitability will result. Will that be for Fortescue? I certainly hope so, I think they are involved in so many areas with so many players, good will come.
HOWEVER: like you I wonder if my investment in FMG is at risk by the green hydrogen endeavour?First of all I look at the SP $18-20, the free cashflow per share (even after all of costs of the green hydrogen project), dividend yield 12.7%, plus Imputation Credit, and debt which is 7$B but a fraction of its Capitalisation and cashflows.
I find it difficult to compare our Iron Ore producers, their PEs are so different, FMG 5.86 (good), and MIn Res' ~78 which I just don't understand. Their NTA's per share are $8.67 verses 17.65. FMG market Cap is 5 times the size.... But I look at both business' and like both. They are both spending big on things that assist them to leverage the asset of Iron Ore that they have rights to mine. For me it is the free cashflow after dividneds and both organisations are looking down the track, so immediate mere "profitability" is not the priority.
As an investor if I can obtain good dividend income, and be leveraged for growth without undue risk to capital, then I am happy.
Hopefully the below is of value, otherwise ask AI the question slightly differently.
Copilot:what is the ratio for hydrogen as compared to oil to create the same energy output?
Certainly! Let’s explore the energy output ratio between hydrogen and oil. When comparing these two fuels, it’s essential to consider their energy content and efficiency. Here are some key points:Energy Content:Hydrogen and oil (such as gasoline or diesel) have different energy content per unit of mass or volume.Hydrogen has a high energy content by weight (meaning it contains a lot of energy per kilogram), but not by volume (it’s less dense).Oil, on the other hand, has a higher energy content by volume (it’s more dense), but less by weight.Energy Equivalency:To compare the energy output, we often use the concept of lower heating value (LHV).LHV represents the energy released when a fuel is completely burned.Here’s a rough comparison:1 kg of hydrogen has an LHV of approximately 120 MJ (megajoules).1 barrel of crude oil (about 159 liters) has an LHV of around 5.8 million BTU (British thermal units), which is roughly equivalent to 6.1 GJ (gigajoules).Therefore, 1 kg of hydrogen contains about 20 times less energy than 1 barrel of crude oil.Efficiency and Applications:Hydrogen can be used efficiently in fuel cells, where it combines with oxygen to produce electricity directly.Oil, especially in internal combustion engines, has more energy loss due to heat and mechanical inefficiencies.In terms of energy conversion efficiency, hydrogen fuel cells can be more efficient than traditional combustion engines.Environmental Considerations:Hydrogen has the advantage of being cleaner in terms of emissions (producing only water vapor when used in fuel cells).Oil-based fuels emit greenhouse gases and contribute to climate change.Storage Challenges:Hydrogen’s low density makes storage challenging. It often requires high-pressure tanks or cryogenic conditions.Oil is more convenient to store and transport due to its higher density.In summary, while hydrogen has a higher energy content by weight, oil (especially in its refined forms) remains the dominant fuel due to its existing infrastructure, convenience, and energy density. However, as we transition toward cleaner energy sources, hydrogen’s role is gaining prominence, especially in applications like transportation and industrial processes. ⚡
Learn more:Hydrogen Compared with Other Fuels1.Energy Equivalency Calculator2.Alternative Fuels Data Center - Fuel Properties Comparison3.Hydrogen Production on Wikipedia4. user Great! The response is informative and engaging. I’ll continue the conversation by asking another question
Have a good weekend.
(20min delay)