🇰🇷 🇨🇦 Fueling the Future: South Korean Investment in Green Hydrogen Propels Newfoundland and Labrador
By Misha Radkevitch
SK ecoplant, the environment and energy arm of SK Group, one of the world’s largest sustainable infrastructure companies, has recently announced a significant investment of US$50 million in Newfoundland and Labrador. The South Korean company will buy a 20 per cent stake in the US$4.5 billion ‘Nujio’qonik‘ project, a global super-large green hydrogen and ammonia commercialization project in the eastern province of Newfoundland and Labrador.
This strategic move aims to accelerate the transition to clean energy and contribute to global efforts in combating climate change. The project’s boost in funding aligns with the growing interest in green hydrogen as a viable and sustainable energy source and the implications of this strategic investment open up new horizons of possibilities in the region.
‘Green Hydrogen Era’
Green hydrogen is a renewable, zero-emission fuel that holds immense potential as a clean and sustainable energy source. It is produced through the electrolysis of water and powered by renewable energy; Project Nujio’qonik will utilize wind power to produce the required electricity. Green ammonia is then produced by synthesizing green hydrogen with nitrogen. Unlike hydrogen itself, which is difficult to transport and store, green ammonia is suitable for transportation around the world, and can then be converted back into hydrogen to be used as energy.
This energy circulation system of the carbon-neutral era, and the green hydrogen value chain built by SK ecoplant, will soon become a reality according to a statement by the firm. Kyung-il Park, CEO of SK ecoplant, says the investment in Project Nujio’qonik is a step toward launching the international green hydrogen industry:
“Newfoundland and Labrador is positioned to launch this industry in Canada and to be amongst the very few first-mover commercial producers of scale world-wide.”
“Project Nujio’qonik has world-class wind, abundant fresh water, a deep-sea port with close proximity to Europe, strong First Nations and community support, and support at all levels of government. Our investment in this project is a step toward producing first green hydrogen and ammonia in 2025 and taking a leadership position in the fight against climate change.”
Kyung-il Park, who last month assumed the role of Chairman of the Korea Wind Energy Industry Association, also added:
“As the first Korean company to participate in an intercontinental green hydrogen commercialization project, we have a competitive advantage and see more future business opportunities.”
“SK ecoplant’s rapid execution ability and extensive experience will help us become a prominent leader in the global green hydrogen and green ammonia market in the future.”
Sean Leet, Managing Director and CEO of World Energy GH2, commented on the collaboration with SK ecoplant:
“This is an international company that can do business anywhere in the world,” said Leet. “Not only did they choose Canada, they chose our home, Newfoundland and Labrador, and they chose Project Nujio’qonik. SK ecoplant recognizes the benefits, advancement, and sophistication of this project, and we look forward to a prosperous partnership.”
“We are incredibly proud of all of our stakeholders, including our First Nations and community partners, who have been instrumental in attracting SK ecoplant’s investment in our project,” said Leet. “We welcome our new investment partners to Project Nujio’qonik, and we look forward to developing a world-class green energy project together.”
Project Nujio’qonik
Project Nujio’qonik is a three-stage project on the west coast of Newfoundland and Labrador in St George’s Bay, overseen by World Energy GH2.
The three-phase development plan is laid out as such:
- Phase 1 Development Plan:
- Up to 2+ GW onshore across two wind farms (Port au Port and Codroy)
- Hydrogen processing facility in the Stephenville region
- Grid interconnections and hydrogen-fuelled turbines at the plant
- Phase 2 Development Plan:
- Additional 1 GW through a third wind farm (location TBC)
- Concurrent expansion of the hydrogen plant
- Phase 3 Plan:
- Evaluate further wind resource potential in the region and potentially expand the project.
Video introducing the Nujio’qonik project (Source: World Energy GH2 YouTube channel)
The prevalence of wind energy in this location is the primary draw for investment and is reflected in the project name, Nujio’qonik, which is the Mi’kmaw name for St. George’s Bay; pronounced ‘new-geo-ho-neek’, it means ‘where the sand blows’. The image below shows the abundance of wind energy at disposal in the project area.
Moreover, the project area has deep-water marine facilities that are uniquely suited to hydrogen production and offloading; this includes access to industrial water for hydrogen production and harbour facilities that are available for construction, operations and shipping. Usefully, SK ecoplant’s subsidiary, SK oceanplant, is a globally recognized top-tier company specializing in substructures for offshore wind power installation. Additionally, interconnection to the existing grid allows for mutually beneficial, seasonable exchange of green energy and provides a potential opportunity to support NL Hydro’s export commitments in the sale of green energy.
Bigger picture
This investment is SK ecoplant’s first investment in a wind-to-green hydrogen project globally and is a clear indicator that Newfoundland and Labrador is rapidly taking centre stage in the clean energy industry.
John Risley, Chairman of World Energy GH2, echoed this belief and insisted that the investment is validation that World Energy GH2 has all of the requirements for a successful project:
“Just nine months after the signing of the Canada – Germany Hydrogen Alliance by Canadian Prime Minister Trudeau and German Chancellor Scholz in Stephenville, Newfoundland and Labrador, trade and export discussions continue to advance between Canada and Germany. This investment from SK ecoplant reflects confidence in the alliance, and also reflects the speed at which this new critical industry is moving.”
Moreover, he highlighted the Government of Canada’s role in creating a “financial climate that is attracting investments of scale.”
“Our country’s robust response to the US Inflation Reduction Act, including the Canada Growth Fund, Investment Tax Credits and Contracts for Difference, are innovative ways Canada is implementing to stand up an industry that can compete globally.”
According to industry reports, the global green hydrogen market is expected to witness significant growth in the coming years; by 2026, the market is projected to reach a value of $11.7 billion. This investment by SK ecoplant positions them at the forefront of this emerging market, providing them with a competitive advantage and positioning Newfoundland as a key player in the green hydrogen sector.
More generally, investments in green hydrogen projects have the potential to drive economic growth and create job opportunities. A study estimates that the development of the hydrogen sector could create up to 350,000 jobs in Canada by 2050. Additionally, the increased adoption of green hydrogen can contribute to the reduction of greenhouse gas emissions, supporting Canada’s commitment to the Paris Agreement and United Nation’s Sustainable Development Goals.
The Honourable François-Philippe Champagne, Minister of Innovation, Science and Industry, attended celebrations of the signing ceremony at Lotte Hotel in Seoul, South Korea and stated:
“This announcement clearly demonstrates Canada’s ability to attract foreign investment and grow a cleaner economy.”
“It is no longer ‘why Canada,’ it is ‘how Canada.’ I am happy to see companies, like SK ecoplant, answer our call for bold projects that build on Canada’s expertise to set up a world-leading hydrogen industry.”
Looking forward
SK ecoplant’s investment in the green hydrogen project in Newfoundland marks a significant step towards a more sustainable future. By embracing green hydrogen, Newfoundland has the opportunity to become a key player in the growing global market and drive economic growth while reducing carbon emissions. The potential benefits of green hydrogen are far-reaching, providing clean energy solutions, job creation, and a pathway to achieving climate goals.
With SK ecoplant’s investment, the green hydrogen sector is poised for rapid growth and further advancements in renewable energy technology. If the project unfolds as planned, developments in Newfoundland’s green hydrogen industry will be closely watched by investors and environmentalists worldwide.
Sources:
Transition Accelerator. “The Role of Hydrogen in Canada’s Future: A Path to Net-Zero Energy”
The Dream of Green Hydrogen Era, SK Eco Plant Realizes! Canada’s New Geohonic Project
Project Nujio’qonik: Harnessing Newfoundland and Labrador’s Wind Energy
Press release: SK ecoplant invests in World Energy GH2’s Project Nujio’qonik
