Iwatani Corp. is abandoning its green hydrogen initiative in Queensland, Australia, following similar exits by Japanese partners and the withdrawal of state government support, dealing another blow to Japan’s hydrogen import ambitions.
The project, which aimed to produce 70,000 tonnes of green hydrogen annually by 2028, had brought together Iwatani with Marubeni Corp., Kansai Electric Power Co., Australian energy firm Stanwell and Singapore’s Keppel Corp. The Queensland government’s decision last month to halt further investments made continuing the venture untenable, prompting Iwatani to shutter its local office.
The setback highlights growing challenges in the hydrogen sector, where production costs remain prohibitively high despite the fuel’s potential as a carbon-free energy source. Transporting hydrogen requires cooling to minus 253 degrees Celsius for liquefaction, making the business commercially unviable without substantial government subsidies.
This retreat follows a pattern of scaling back hydrogen initiatives. Kawasaki Heavy Industries Ltd. previously abandoned plans to transport hydrogen derived from lignite from Victoria, Australia, to Japan after facing significant delays, opting instead for domestic procurement.
Iwatani, which holds the largest share of Japan’s industrial hydrogen market for applications like liquid crystal manufacturing, had been aggressively investing across the hydrogen supply chain as part of its decarbonization strategy.
