eFuel plant planned for Australia

PORSCHE has stepped up its investment in the development of industrial eFuel production facilities in Chile, the US and, notably, Australia, where HIF Global – in which the German marque has acquired a 12.5 per cent stake – will begin constructing a plant in 2024.

The Zuffenhausen-based brand this week announced that it had invested the equivalent of $A100 million in Santiago-based HIF Global LLC – a holding company of internationally active project developers of eFuel production facilities. Having begun construction of the Haru Oni pilot plant in Punta Arenas, HIF Global will next set up facilities in the US and Australia.

Initiated by Porsche and implemented with partners including Siemens Energy and ExxonMobil, production of eFuels from hydrogen and CO2 using wind energy is expected to start at the Chilean Patagonian facility later this year. The pilot plant is expected to produce around 130,000 litres of eFuels in 2022, after which its capacity will be expanded in two stages to around 55 million litres by 2024, and around 550 million litres by 2026.

HIF Australia chief executive officer Ignacio Hernandez said that the firm was considering locations for its Australian plant in Northern Queensland, Victoria and Tasmania – areas that had abundant supplies of renewable energy (notably wind) as well as existing infrastructure. 

Synthetic eFuel enables the nearly-CO2-neutral operation of combustion engines because the CO2 used to create the fuel is drawn from the atmosphere. As the automotive world rapidly transitions towards e-mobilty, eFuels remain of particular interest to industries for which electrification is not viable, such as aviation and shipping. What’s more, it can power modern ICE vehicles either on its own, or when blended with fossil fuel-based petrol. 

Mr Hernandez added HIF hoped to announce the chosen location for the Australian plant later this year. Construction of the plant, which would leverage learnings from the pilot Haru Oni facility, was earmarked to begin in 2024 and would take about 2.5 years to complete.

The exact cost of building the plant, which would ultimately produce 550 million litres of eFuel a year, would depend on various factors pertaining to its location, but would amount to roughly $1 billion in capex. HIF have already held discussions with State governments about partnering on the project, during which it received “positive reactions”, he said.

With its investment in HIF Global LLC, Porsche is participating in an international

financing round alongside the Chilean company Andes Mining & Energy (AME) and

the American companies EIG, Baker Hughes Company and Gemstone Investments.

In total, an amount in the low nine-figure USD range is flowing into HIF Global LLC.

“By investing in industrial eFuel production (the German firm has committed more than $US100 million), Porsche is further expanding its commitment to sustainable mobility,” said Barbara Frenkel, who is a member of the executive board for procurement at Porsche AG.

"Porsche is moving into an attractive business area with its stake in HIF Global, which has been an excellent partner. Synthetic fuels offer attractive prospects across many sectors, from the automotive industry to the aviation and shipping sectors,” Ms Frenkel added. 

Michael Steiner, a member of the executive board for research and development at Porsche AG, said that although electrification was the German brand’s overarching strategy, eFuel could play an important role to help the automotive sector transition from fossil-based to sustainably-made fuels – after all, there are still 1.3b ICE-powered vehicles on the globe.

“We see ourselves as pioneers in eFuels and want to drive the technology. This is one building block in our clear, overall sustainability strategy,” Mr Steiner said. 

Although Porsche had no intention of becoming a major producer of eFuel, which will have an estimated wholesale price of $US2.00 per litre by 2026, the firm wanted to ensure its ICE models, such as the 911 sportscar, could still be driven and enjoyed in future, while emitting up to 85 per cent fewer emissions, by virtue of running on sustainably produced “unleaded”. 

Modern ICE-powered vehicles that run on petrol can operate on eFuel, which is derived from the e-methanol, without a problem. However, eFuel is not only an alternative to fossil fuel – it can be blended with the latter to create lower-emission fuel variants for public use.

“E-methanol is an important raw material for other applications, such as in the chemical industry, where it can replace raw materials of fossil origin. E-methanol is an intermediate product that is produced during the generation of eFuel,” Mr Steiner added.

For now, Porsche plans to use eFuel produced in Chile in its Mobil 1 Supercup motorsport series (from the second half of the year), for the initial fuelling of combustion-engined models it produces at its factories and, ultimately, at selected Porsche Experience Centres.