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Global Energy Ventures an early mover in large-capacity compressed hydrogen shipping: Pac Partners Equity Research

Published: 12:59 11 Jun 2021 AEST

Global Energy Ventures Ltd - Global Energy Ventures early mover in large-capacity compressed hydrogen shipping: Pac Partners Equity Research
The company has secured a recommendation of speculative buy and a price target of $0.27/share.

Global Energy Ventures Ltd (ASX:GEV) (FRA:WS9) looks to be an early mover in large-capacity compressed hydrogen shipping that will be required to link future cheap renewable power-sourced hydrogen (H2), with emerging distant users of carbon-free energy – according to a report from Pac Partners Equity Research.

The company is also progressing its compressed natural gas (CNG) shipping system, which is nearing commercialisation and recently entered into an MOU with Germany-based ILF Beratend Ingenieure GmbH (ILF) consulting engineers to identify and develop green hydrogen projects in Europe and Australia that include GEV’s C-H2 shipping solution.

Pec Partners said: “We see the pilot C-H2 vessel development initiative, GEV’s own renewable energy development ambitions and the MOU with ILF as evidence that GEV is leading development and is the partner of choice for H2 maritime transport solutions.

“We make no change to our $0.29/share risked NPV and $0.27/share 12-month price target at this stage.”

Pilot C-H2 vessel

The report noted: “GEV is maintaining its global leadership in hydrogen (H2) shipping with the June 7, 2021, announcement that it has commenced development of a 430-tonne compressed H2 vessel, a pilot-scale of its 2,000-tonne C-H2 vessel.

“GEV will seek American Bureau of Shipping (ABS) Approval-In-Principal by SepQ21 and Full Class Approval by late 2022 – to precede development.

“Note the 2000 tonne vessel has already received ABS Approval-In-Principal in March 21.

“The pilot C-H2 vessel will be well matched to proposed mid-2020’s renewable energy sourced green H2 projects, particularly in Northern Australia from third parties as well as GEV’s own proposed 1.5GW renewable energy plant.”

These H2 projects start with modest production volumes as dictated by current engineering limits and undeveloped markets, however, Pec Partners noted that emergent H2 demand as a blend to existing natural gas supply is a likely kick-starter for the industry.

ILF MOU

The MOU with ILF seeks to identify and develop green hydrogen projects in Europe and Australia that include GEV’s C-H2 shipping solution.

ILF already has clients seeking green H2 supply, with Europe currently having more than 80% of the world’s proposed H2 projects with 19GW in Germany, the Netherlands and the UK alone.

Leading hydrogen shipping solution

The report states that the hydrogen industry’s development will likely occur where there are as few obstacles to development as possible with combining the falling cost of renewable power with low-cost land and high per acre-yields of sunlight or wind a first step.

“However, these places such as in Northern Australia are often remote from the developing H2 markets. GEV’s C-H2 vessel can provide a maritime transport solution sooner and with a lower up-front capital and carbon footprint than competing liquefied mode of transporting H2 product for the following reasons:

  • GEV state that the 430 tonne CH2 system of twin 12 metre diameter tanks fit within a Handymax scale skip for quicker development, shallow 9 metre draught that increases project development flexibility and secures green credentials as will be powered by H2 fuel cells. These make a mid-2020’s pilot ship delivery possible; and
  • GEV’s C-H2 shipping solution has lower upfront capital costs and operating advantages than is associated with liquefied H2 facilities. The latter require high-cost cryogenic facilities to cool H2 to -253 degrees Celsius, a process that requires specialist engineering and the process consumes around 11kWh/kg of 28% of the H2 liquified energy content. It also comes with H2 boiloff issues during transport and the need for expensive storage and regasification facilities at port.”

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