Oil giant BP buys 40.5% stake in massive renewables and green hydrogen project

A BP logo photographed in London on May 12, 2021. The International Energy Agency recently reported that 2021 saw energy-related carbon dioxide emissions rise to their highest level in history.

The Asian Renewable Energy Hub is a huge project planned for Australia that will span an area of over 6,000 square kilometers.

According to the announcement, the development has the potential to be one of the largest renewable and green hydrogen hub in the world.

The project will develop up to 26 gigawatts of combined solar and wind generating capacity.

The hub is supposed to give power to local customers. Australia would be home to the hydrogen and ammonia.

The AREH is expected to be able to produce up to 9 million tonnes of green ammonia per annum.

The operatorship of the project would be assumed by the firm on July 1.

The shares of the company traded lower on Wednesday.

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There are a number of ways in which hydrogen can be produced. An electric current splits water into oxygen and hydrogen.

If the electricity used in this process comes from a renewable source such as wind or solar, then it's called "green" or "renewable" hydrogen. Fossil fuels are the main source of hydrogen generation.

The amount that was paid for its stake in the AREH project was not disclosed. InterContinental Energy is one of the shareholders. Their stakes are both high and low.

While Wednesday's news is a shot in the arm for the Asian Renewable Energy Hub, the project's development has not been without its challenges.

The Asian Renewable Energy Hub will be one of the largest renewable and green hydrogen energy hubs in the world and can make a significant contribution to Australia.

By the year 2050 or before, the company says it will be a net-zero company. It is one of the largest firms to have made a net-zero pledge.

There are a lot of financial and logistical hurdles that need to be overcome in order to achieve such commitments. Goals can be light on the devil and he is in the detail.

Fossil fuels are a key part of the global energy mix and companies continue to find and develop oil and gas fields around the world.

The International Energy Agency reported in March that carbon dioxide emissions rose to their highest level in history.

According to the IEA, global energy-related CO2 emissions reached a record high in 2011.

New funding for fossil fuel exploration was slammed by the UN Secretary-General as "delusional" and he called for an abandonment of fossil fuel finance.