March 2024 quarter fuels progress on Pure Hydrogen’s HFC vehicle and micro-hub strategies

Ongoing progression of the commercial sales pipeline for PH2’s market-leading suite of hydrogen fuel cell (HFC) vehicles
Order for HFC waste collection truck made post quarter-end
Key progress during the quarter on PH2’s low-capex hydrogen micro-hub strategy

Special Report: The March 2024 quarter has proven to be a fruitful one for Pure Hydrogen’s goal of spearheading the growth of the Australian hydrogen market.

During the quarter, Pure Hydrogen (ASX:PH2) continued to expand the sales pipeline for its hydrogen fuel cell (HFC) vehicle offerings and progressed execution of its low capex hydrogen infrastructure strategy.

It comes amid a positive macro picture. The Australian government is boosting research in renewable hydrogen with Australian Renewable Energy Agency awarding $34.2m worth of funding to 13 hydrogen projects studying production of the gas as well as its storage and transportation.

Meanwhile, Fortescue has officially opened its major electrolyser manufacturing facility in Gladstone, while construction has started on a 480-megawatt solar plant that will power Stanwell’s export oriented Central Queensland hydrogen project.

Hydrogen vehicle pipeline expands

PH2 hosted investors at its Drive Day on 19 March 2024, which showcased its HFC Taurus prime mover and EV70 minibus.

The Company also signed a Memorandum of Understanding with the state government of Piauí in Brazil to assist in the development of hydrogen solutions as part of its clean energy transition. The MOU sets out a framework to leverage PH2’s expertise in manufacturing and design of HFC vehicles alongside hydrogen infrastructure solutions.

Post quarter-end, the company executed an additional sales agreement with Australian waste management company Solo Resource Recovery for a rear-loading HFC waste collection truck that will be deployed in Adelaide.

This vehicle is expected to be deployed in the second half of this calendar year and will be one of three demonstration waste collection trucks.

Solo is also taking delivery of two garbage trucks with one – a side loader – to be deployed in northern NSW while the other will be deployed by the City of West Torrens council in Adelaide.

PH2 has also received significant interest across Australia and international markets from established waste management and transport industries for its HFC vehicles.

Meanwhile, the HFC waste removal truck for JJ’s Waste and Recycling has passed all tests with final approval pending from the federal government before it goes into service.

First micro-hub selected

Alongside its hydrogen vehicle suite, PH2 is also progressing its strategy of developing low capex green hubs situated close to potential customers that will produce green hydrogen using on-site solar and green electricity to power module-built electrolysers.

Following the end of the quarter, the company signed a lease on a 4000m2 commercial site at Archerfield airport in Brisbane that will house its first hydrogen micro-hub.

It has already ordered the electrolyser, expected to cost ~$880,000, which will crack water molecules into hydrogen and oxygen atoms.

Supply of 420kg per day of green hydrogen will begin Q4 2024 under the first stage of the Archerfield development, which will serve as the template for future micro-hubs.

Stage 1 will take up 1000m2 of the 4000m2 site, leaving room for potential scale-up when demand increases.

All equipment – including the electrolyser – will be housed in shipping containers that will be installed on any hard stand site.

Construction starts on turquoise hydrogen demonstration plant

During the quarter, the company also noted that its 40%-owned investee company Turquoise Group has started construction of the commercial prototype demonstration plant

The plant will use methane plasma pyrolysis to convert methane into hydrogen and carbon without carbon dioxide emissions.

The prototype is expected to be operational in the June quarter and its ouput tested with results announced in the next few months.

Other activity

While hydrogen was the main focus for the company during the March 2024 quarter, PH2 also executed the strategic sale of its 30% interest in the Serowe project to operator Botala Energy (ASX:BTE) post quarter-end.

The sale was structured to provide PH2 with continued exposure to any project upside through the 14.5 million BTE shares it received as consideration for the sale along with a milestone payment of $750,000 that is contingent on reserve certifications.

This article was developed in collaboration with Pure Hydrogen, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.