Porsche buys into group eyeing $1b e-fuels plant in...

Porsche buys into group eyeing $1b e-fuels plant in Australia

Simon Evans Senior Reporter Apr 7, 2022 – 5.00am
Porsche has acquired a $100 million stake in e-fuels group HIF Global, which is planning a potential $1 billion production plant in Australia to make synthetic fuels, modelled on a pilot plant it is building in southern Chile.Porsche believes there will still be a big need for liquid fuels next decade even if large numbers of car drivers switch to electric vehicles. Such synthetic fuels would be made via an industrial process using hydrogen.HIF Global is looking at prospective sites in northern Queensland, Victoria and Tasmania. Access to renewable energy and high winds is important for the technologically ambitious project.Porsche executive board member for research and development Michael Steiner said Porsche still aimed for 80 per cent of its new vehicle sales to be fully electric by 2030, but the development of e-fuels was an important extra strategy for the large numbers of traditional vehicles that would still be on the road.Porsche executive board member for procurement Barbara Frenkel said over time there would be extra pressure on petrol from government taxes around the world which would help the take-up of synthetic fuels.“More and more you can imagine that fossil fuels become more expensive with extra taxes on them,” she said from southern Chile via a video call.AdvertisementPorsche has acquired a 12.5 per cent stake in HIF Global for $US75 million ($100 million). HIF Global is part-way through building the Haru Oni pilot plant in southern Chile making synthetic fuel, which the company says is very close to being carbon-neutral when used in traditional internal combustion engines. It is working with Siemens Energy and ExxonMobil on the Chilean project.Porsche executive board member Barbara Frenkel. The Chilean plant will produce 55 million litres of the fuel annually by 2024, and can be scaled up to 550 million litres by 2026. Ms Frenkel said she and other Porsche board members had been inspecting the progress of the plant in Chile and has experienced first-hand the fierce winds firsthand that are being harnessed as a renewable energy source.HIF Global chief financial officer Ignacio Hernandez, who is also the chief executive of HIF Australia, said the capital cost of a similar-sized full-scale production plant in Australia was likely to be around $1 billion. The aim is to have that up and running by 2026. Mr Hernandez said the construction time was around two and a half years. “The location hasn’t been narrowed down to one yet,” he said.The biggest shareholder in HIF Global is Chilean company Andes Mining & Energy. Other new investors alongside Porsche include US companies EIG, Baker Hughes Company and Gemstone Investments.Mr Hernandez said HIF was also looking to build a large plant in the US.Under the synthetic fuels process, electrolysers split water into oxygen and green hydrogen. Carbon dioxide is then filtered from the air and is combined with hydrogen to produce synthetic methanol. It is then converted into fuel using a Methanol To Gasoline technology licensed by ExxonMobil.Mr Steiner said e-fuels were likely to be in big demand in the shipping and aviation sectors, along with automotive. There were large numbers of internal combustion engine vehicles that would still be on the roads in decades, particularly in remote areas.“From our point of view, there will be a need for liquid fuel,” he said.Mr Steiner said Porsche wanted to be on the front foot and would first use the e-fuel in motorsport projects. Eventually, it could become a replacement fuel for the billions of combustion engine vehicles that will still be driven by owners, including the hugely popular Porsche 911.Electric vehicle take-up is starting to gather pace in Australia off a low base. Tesla is the biggest selling electric vehicle brand in Australia, followed by Chinese-owned MG.