TotalEnergies: Green Hydrogen: TE H2 Partners with VERBUND on a Large Project in Tunisia

Rhea-AI Summary

TE H2, a joint-venture between TotalEnergies (TTE) and EREN Groupe, alongside Austria's VERBUND, signed a Memorandum of Understanding (MOU) with Tunisia to explore a significant green hydrogen project, H2 Notos. This initiative aims to produce 200,000 tons of green hydrogen annually in its initial phase, with potential scalability to one million tons per year. The hydrogen will be produced using electrolysers powered by wind and solar energy and desalinated seawater. The project will connect to Central Europe via the SoutH2 Corridor pipeline, expected to be operational by 2030. VERBUND will lead the hydrogen transportation to Europe, while TE H2 will oversee the project's development and operation.

Positive

• TE H2 and VERBUND sign MOU with Tunisia for a green hydrogen project.
• Initial phase aims to produce 200,000 tons of green hydrogen annually.
• Potential scalability to one million tons per year in South Tunisia.
• Project to use renewable energy sources: wind and solar.
• Access to the European market through the SoutH2 Corridor pipeline by 2030.
• VERBUND will coordinate hydrogen transport to Central Europe.
• Significant job creation potential in Tunisia.
• Strengthens Tunisia's attractiveness for foreign investment in renewables.
• Supports Europe's transition to green hydrogen.

Negative

• Project feasibility still under assessment, introducing potential risks.
• Dependence on large-scale infrastructure projects like the SoutH2 Corridor.
• Long timeline with the pipeline expected to be operational only by 2030.

Insights

Energy Market Analyst

The partnership between TotalEnergies, VERBUND and the Republic of Tunisia for the H2 Notos project marks a significant advancement in the green hydrogen sector. This project aims to produce 200,000 tons of green hydrogen annually in its initial phase, scaling up to one million tons per year. Green hydrogen is becoming an increasingly vital component of the energy transition, offering a clean alternative to fossil fuels.

From a market perspective, the availability of green hydrogen at a large scale can address the growing demand in Europe, particularly for industries that are hard to electrify, such as steel and chemicals. The integration of this project into the SoutH2 Corridor, a planned hydrogen pipeline, further underscores its strategic importance.

Investors should consider the long-term benefits of this venture, including the potential for job creation and economic development in Tunisia, alongside the environmental benefits. However, the project’s reliance on infrastructure that is not yet operational, such as the SoutH2 Corridor expected around 2030, introduces a certain level of risk and uncertainty.

Additionally, the project’s success hinges on technological feasibility and cost-effectiveness of hydrogen production and transportation. The financial implications for TotalEnergies and its partners will depend on the ability to manage these aspects efficiently.

Financial Analyst

The financial landscape of the H2 Notos project is poised to attract substantial investment, reflecting the broader trend towards sustainable energy. TotalEnergies and VERBUND will lead the development, financing and operation of this ambitious project. The scale of the investment required suggests a long-term commitment, with significant capital expenditures expected during the development and construction phases.

For TotalEnergies, this project aligns with its strategic focus on expanding its renewable energy portfolio. The company's ability to finance large-scale green projects can enhance its market position and potentially lead to favorable valuation from investors who prioritize sustainability.

However, investors must consider the potential financial risks, including cost overruns, delays in pipeline commissioning and fluctuations in green hydrogen demand in Europe. The economic viability of green hydrogen production largely depends on advances in technology to reduce costs and improve efficiency.

Moreover, regulatory support and subsidies for green hydrogen in Europe could play a significant role in determining the project's financial success. Investors should monitor policy developments closely, as they could impact the project's revenue streams and profitability.

Tech and Engineering Expert

The engineering complexities of the H2 Notos project are noteworthy. Producing green hydrogen at scale involves using electrolysers powered by extensive onshore wind and solar projects, which requires advanced technology and significant capital investment. The desalination of seawater for hydrogen production is an additional technical challenge that must be addressed efficiently.

The project's integration with the SoutH2 Corridor pipeline system, intended to transport hydrogen from North Africa to Europe, underscores the importance of reliable and scalable pipeline infrastructure. The success of this endeavor will depend on technological advancements in electrolyser efficiency, renewable energy integration and hydrogen transport logistics.

Moreover, the development of this project in South Tunisia presents unique geographical and environmental challenges. Engineering solutions must account for the arid climate and potential logistical issues. The technical feasibility studies during the initial phases will be important in identifying and mitigating these challenges.

From a technological standpoint, the project's impact on the green hydrogen market will be significant if the technical hurdles can be overcome, leading to widespread adoption and scalability of this clean energy source.

PARIS & TUNIS, Tunisia--(BUSINESS WIRE)-- Regulatory News:

TE H2 a joint-venture between TotalEnergies (Paris:TTE) (LSE:TTE) (NYSE:TTE) and EREN Groupe, together with VERBUND, Austria’s leading electricity company, have signed a Memorandum of Understanding with the Republic of Tunisia to study the implementation of a large green hydrogen project named “H2 Notos” for export to Central Europe through pipelines.

H2 Notos aims to produce green hydrogen using electrolysers powered by large onshore wind and solar projects and supplied with desalinated sea water. The project aims to produce 200,000 tons of green hydrogen annually during its initial phase, with the potential to scale up production to one million tons per year in South Tunisia. The project will have access to the European market through the “SoutH₂ Corridor”, a hydrogen pipeline project connecting North Africa to Italy, Austria, and Germany, which is expected to be commissioned around 2030.

TE H2, together with VERBUND, will be leading the development, financing, construction, and operation of the integrated project from production of green electricity to production of green hydrogen. In addition, VERBUND will coordinate the transport of the produced hydrogen towards Central Europe.

David Corchia, CEO of TE H2, said: “The signing of this MOU with the Republic of Tunisia marks the actual start of this highly ambitious project after months of work and interactions with all stakeholders. We are delighted to partner with VERBUND to support the development of such a pioneering and ambitious endeavor in such a strategic location. H2 Notos has the potential to become a significant supplier of green hydrogen for Europe while fostering significant jobs creation in Tunisia. We are entering into a phase of greenfield development and major technical work to assess the feasibility of the project and we will need to further deepen the highly constructive and fruitful collaboration we have enjoyed with the national and local authorities through H2 Notos.”

Fatma Thabet Chiboub, Tunisia's Minister of Industry, Mines and Energy, stated: "This agreement with TE H2 and VERBUND marks a significant step forward in our quest for clean, sustainable energy. Tunisia, firmly committed to its energy transition, sees in this project a strategic pivot to strengthen its attractiveness as a destination of choice for foreign investment in renewable energies."

Michael Strugl, CEO of VERBUND AG, added: “Tunisia is a particularly important upstream region in terms of scalability and competitiveness and a significant part of VERBUND's hydrogen plans. We have set ourselves the goal of supplying the European industry with green hydrogen. By combining competitive hydrogen production in Tunisia and pipeline-based transportation, we can ensure a long-term supply at scale to support a sustainable transition of our customers to green hydrogen as well as support a sustainable economic development in Tunisia. We are delighted to be working with a strong consortium capable of realizing GW-scale projects and look forward to developing them in partnership and close collaboration with the Tunisian authorities and population.”

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About TE H2
TE H2 is an 80/20 joint-venture formed by TotalEnergies and EREN Groupe, specialized in developing and structuring large-scale green hydrogen projects located in world-class sites benefitting from exceptional renewable resources, such as North Africa, Latin America, and Australia. TE H2 is made up of an expert team with extensive know-how in the development, construction and operation of wind and solar projects globally. By combining technical expertise and experience, TE H2 aims to deliver globally impactful renewable energy projects that provide affordable, sustainable, reliable, and accessible energy to as many people as possible.

About VERBUND
VERBUND Green Hydrogen GmbH is part of VERBUND, Austria's leading energy company and one of the largest hydropower producers in Europe. The Group generates around 98 % of its electricity from renewable energy, primarily from hydropower. VERBUND trades electricity in 12 countries and generated around € 2.266m group result and € 4.490m in EBITDA in 2023 with approximately 3,800 employees. With its subsidiaries and partners, VERBUND is active in the generation of electricity, transmission and in international trading and sales. VERBUND has been quoted on the Vienna Stock Exchange since 1988 with 51% of the share capital being held by the Republic of Austria.

VERBUND is the decisive player for the success of the energy transition in Austria. The challenges that lie ahead require a new company spirit, which VERBUND is driving forward with its Mission V. The Mission V is a long-term and comprehensive transformation program and stands for the will to confront the climate crisis as a force for change. This program is based on the VERBUND Strategy 2030 with its three main pillars: Strengthening the integrated home market, expanding renewable energies in Europe and becoming a European hydrogen player. With Mission V, VERBUND is accelerating the achievement of the strategic goals 2030 and ensuring their implementation.

Further information: www.verbund.com

Cautionary Note
This document may contain forward-looking information and statements that are based on a number of economic data and assumptions made in a given economic, competitive and regulatory environment. They may prove to be inaccurate in the future and are subject to a number of risk factors. No entity under this Press Release nor any of their subsidiaries assumes any obligation to update publicly any forward-looking information or statement, objectives or trends contained in this document whether as a result of new information, future events or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240528445940/en/

TE H2 Contacts

Media Relations + 33 (0) 6 18 23 76 99 l solange.petit-de-bantel@totalenergies.com

Investor Relations +33 (0)1 47 44 46 46 l ir@totalenergies.com

VERBUND AG Contact:

Rainer Tschopp, +43 (0)664 – 882 613 32 l rainer.tschopp@verbund.com

Source: TOTALENERGIES SE

FAQ

What is the H2 Notos project by TE H2 and VERBUND?

H2 Notos is a green hydrogen project in Tunisia aiming to produce and export 200,000 tons annually, potentially scaling to one million tons.

How will the H2 Notos project transport green hydrogen to Europe?

The project will use the SoutH2 Corridor pipeline to connect North Africa to Italy, Austria, and Germany, expected to be operational by 2030.

What are the renewable energy sources for the H2 Notos project?

The project will use wind and solar energy to power electrolysers for producing green hydrogen.

What is the significance of the MOU signed by TE H2 and VERBUND with Tunisia?

The MOU signifies the start of the H2 Notos project, marking a strategic move for Tunisia in renewable energy and green hydrogen production.

What is the potential production capacity of the H2 Notos project in its initial phase?

The initial phase aims to produce 200,000 tons of green hydrogen annually.