Term Sheet for hydrogen supply and offtake with Uniper
Highlights:
- Provaris, Uniper and Norwegian Hydrogen sign a conditional Term Sheet for hydrogen supply, transport and offtake.
- Agreed Key Terms and Conditions to form the basis of negotiating a binding Hydrogen SPA, targeted for June 2025.
- Annual volume of 42,500 tonnes per year of RFNBO certified hydrogen to be delivered as gaseous compressed hydrogen using Provaris’ H2Neo carriers.
- Uniper Global Commodities SE will be the buyer of hydrogen at an agreed fixed price and responsible for the receiving terminal in North-Western Europe for delivery.
- Commencement of cargos deliveries is targeted for early-2029, for a minimum term of 10-years, making it Europe’s first regional hydrogen marine transport project at scale.
- Term Sheet for supply of hydrogen using Provaris carriers demonstrates Uniper’s commitment to a portfolio of supply sources, including a focus on supply from the Nordic Region.
- Provaris’ approach to hydrogen supply and transport provides a standardized, efficient and flexible approach to scaling hydrogen supply, which is exactly what Germany and Europe needs to meet its 2030 decarbonisation targets.
6 January 2025 / OSLO: Provaris Energy Ltd (Provaris; ASX:PV1) is pleased to advise the collaboration with Uniper Global Commodities SE (Uniper) and Norwegian Hydrogen AS has advanced to the execution of a conditional Term Sheet for the supply, transport and offtake of RFNBO compliant hydrogen. The Term Sheet provides the basis of negotiating a binding Hydrogen Sale and Purchase Agreement (Hydrogen SPA) which is targeted for June 2025.
Execution of the Term Sheet achieves a significant milestone under the Memorandum of Understanding (MOU), announced in August 2024, and facilitates ongoing co-operation on developing hydrogen supply chains based on Provaris’ compressed hydrogen carriers from Norway and other potential Nordic sites to import locations in North-Western Europe.
Provaris’ Managing Director and CEO, Martin Carolan, stated: “We are delighted to see the collaboration has progressed to a Term Sheet for hydrogen supply and offtake. This represents a key milestone for Provaris and validation towards developing regional bulk-scale hydrogen supply chains within Europe using Provaris’ H2Neo compressed hydrogen carriers.”
Norwegian Hydrogen CEO, Jens Berge, added: “We’re very excited about this tri-party collaboration, and it’s rewarding for all three parties to see our efforts progress into increasingly concrete and advanced stages”
Uniper Global Commodities SE, Senior Vice President - New Energies Origination, Benedikt Messner, commented: “We think that the innovative transport concept by Provaris might be a solution to connect commercially interesting hydrogen supply locations with our core markets and look forward to the continuation of our collaboration.”
Compression Replaces Complexity with Simplicity to Lower the Delivered Cost of Hydrogen
Analysis by the collaboration partners has highlighted that when customer demand is for hydrogen (not a derivative), regionally sourced hydrogen from the Nordics, transported through Provaris’ compressed hydrogen carriers, provides an efficient and cost-effective supply chain, limiting the losses in the entire chain from electrolyzer through to the distribution pipeline in Europe.
Lowering the energy consumption over the entire supply chain results in more renewable energy available for hydrogen production and higher volumes delivered.
Hydrogen Supply Chain Development
Provaris and Norwegian Hydrogen are collaborating on the development of the supply of RFNBO compliant hydrogen, which will be stored and transported using Provaris’ H2Neo carriers. Work is underway to outline the preferred sites in the Nordics, including Norway and Finland. Sites with a detailed feasibility include the FjordH2 Project located in the Alesund region, Norway.
Based on the proposed hydrogen volumes and shipping distance, the supply chain’s storage and shipping infrastructure using Provaris’ proprietary shipping solutions will include one (1) H2Leo barge storage at the production site, with a capacity of 450 tonnes of compressed hydrogen at 250 barg pressure, and two (2) H2Neo hydrogen carriers with an individual storage capacity of 450 tonnes of compressed hydrogen at 250 barg pressure. Provaris continues to progress both the H2Neo and H2Leo towards Final Class approvals in the first half of 2025.
Uniper will be responsible for the selection and development of the import terminal and are working with Provaris to outline the capital and operating equipment to discharge the H2Neo carriers, which includes an assessment of optimal storage and connection to the European Hydrogen Backbone for distribution to industrial sectors. Simplicity of port infrastructure provides for the flexibility of nominating one or more entry ports.
The Term Sheet remains conditional upon, among others, the negotiation and execution of a fully termed Hydrogen SPA and obtaining all necessary approvals.
Illustration of the Regional Supply locations from the Nordic Region into North-West European ports with hydrogen import development plans linked to the future development of Germany’s core hydrogen network
Source: Provaris Energy
Key Terms and Objectives of the Hydrogen SPA Term Sheet
The executed Term Sheet summarises certain essential (but not exhaustive) terms and conditions which will form the basis for negotiation of a Hydrogen SPA. The parties to the Term Seet are Uniper Global Commodities SE, Norwegian Hydrogen AS and Provaris Energy Ltd.
Seller |
Norwegian Hydrogen or a special purpose vehicle which may include Provaris and other investors. |
Buyer |
Uniper Global Commodities SE |
Product Certification |
Certified hydrogen based on RFNBO compliant hydrogen “RFNBO” means that the fuel was produced via electrolysis process, the electricity demand for the electrolysis process was sourced according to the criteria defined by the RFNBO Delegated Act, achieves the GHG saving threshold of 70% compared to a fossil fuel 94 g CO2e/MJ according to the methodology defined by the RFNBO Delegated Act compliant hydrogen |
Annual Contract Quantity |
42,500 metric tonnes of hydrogen after an agreed build-up period. During each Contract Year after the Build-up Period Buyer shall take and pay for, or pay for, if made available but not taken, not less than the following Minimum Annual Quantity. |
Shipping |
Seller shall deliver each cargo of RFNBO compliant compressed hydrogen using ships transporting up to 450 t/cargo which are compatible and comply with relevant requirements of the Buyer’s agreed Receiving Terminal. |
Delivery Basis |
Delivery will be “Delivery at Place” (DAP) at Buyer’s Receiving Terminal. Buyer shall provide all required facilities (including any required hydrogen storage facilities) and connections for the take-off of the agreed compressed hydrogen and its injection into the envisaged European hydrogen transport pipeline system. |
Term |
10 years, plus extension of 5 years subject to mutual agreement. |
Contract Price |
The Contract Price will be set at a fixed price level. Provisions to include annual price review. |
Target Milestones |
June 2025: Binding conditional Hydrogen SPA. December 2025: Unconditional Hydrogen SPA. |
END –
This announcement has been authorised for release by the Board of Provaris Energy Ltd
For further information please contact:
Norm Marshall
Company Secretary
+61 481 148629
Martin Carolan
Managing Director CEO
+61 404 809019
Symbol: ASX.PV1
X (Twitter): @ProvarisEnergy
LinkedIn: Provaris Energy Ltd.
Email: [email protected]
Sydney | Oslo
About Provaris Energy
For more information: www.provaris.energy
Provaris Energy Ltd (ASX: PV1) is an Australian public company developing a portfolio of integrated green hydrogen projects strategically focused on the European market where policy for energy security and decarbonisation depends on new bulk storage and maritime imports. Collaborating with European producers for hydrogen supply and German utilities for offtake of compressed hydrogen offers the lowest regional delivered cost in Europe. Our proprietary tank IP and innovative ship design prioritises simplicity and efficiency to reduce storage and transport costs. More recently, a strategic partnership to innovate CO2 tank design for storage and marine transport, enabling higher volumes over long distances, is increasing our leadership in the energy transition.
About Norwegian Hydrogen
Norwegian Hydrogen is a hydrogen company with operations throughout the Nordic region. The company focuses on both the production and distribution of green hydrogen, tailored to meet future requirements for zero-emission fuel in a wide range of mobility sectors and industrial segments. The company is backed by several strong industrial owners with a significant footprint within the global hydrogen value chain, such as Fortescue, Mitsui Co., Ltd, Flakk Group, Hexagon Purus and Norwegian hydropower company Tafjord.
Norwegian Hydrogen has its head office in Ålesund, and they also have offices in Oslo, Helsinki, Copenhagen and Stockholm.
Contact information:
Jens Berge, CEO Norwegian Hydrogen AS, Email: [email protected], Mobile: +47 90 55 13 55
Marielle Furnes Mannseth, Group Brand Sustainability Officer Norwegian Hydrogen AS, Email: [email protected], Mobile: +47 93 40 21 40
Disclaimer: This announcement may contain forward looking statements concerning projected costs, approval timelines, construction timelines, earnings, revenue, growth, outlook or other matters (“Projections”). You should not place undue reliance on any Projections, which are based only on current expectations and the information available to Provaris. The expectations reflected in such Projections are currently considered by Provaris to be reasonable, but they may be affected by a range of variables that could cause actual results or trends to differ materially, including but not limited to: price and currency fluctuations, the ability to obtain reliable hydrogen supply, the ability to locate markets for hydrogen, fluctuations in energy and hydrogen prices, project site latent conditions, approvals and cost estimates, development progress, operating results, legislative, fiscal and regulatory developments, and economic and financial markets conditions, including availability of financing. Provaris undertakes no obligation to update any Projections for events or circumstances that occur subsequent to the date of this announcement or to keep current any of the information provided, except to the extent required by law. You should consult your own advisors as to legal, tax, financial and related matters and conduct your own investigations, enquiries and analysis concerning any transaction or investment or other decision in relation to Provaris. $ refers to Australian Dollars unless otherwise indicated.
